The consortium of 27 lenders are ready to recast their Rs 7,000-crore loan to the troubled Kolkata-based DI pipes maker Electrosteel Steels and the proposal may go to the corporate debt restructuring cell next month, according to a senior official of State Bank of India.

“The lenders are ready to recast the Electrosteel Steels’ Rs 7,000 crore loan provided they meet our demands, which include corporate guarantees by promoters.

“Hopefully, the proposal will go to the CDR cell next month and the process will be completed towards the end of the second half, that is by September-end,” a senior SBI official has told PTI, adding the bank has given more than Rs 1,000 crore to the company. SBI is the leader of the leader of the 27-member lenders’ consortium.

Under the CDR regime, which is mechanism to help troubled companies to restructure their loans, 75 per cent of the lenders should accept the CDR proposal.

According to the new-tightened CDR norms, the promoters seeking to recast their loans should bring in 25 per cent of the loan amount as fresh capital infusion.

The SBI official clarified that the Electrosteel Steels CDR has been accepted by around 60 per cent of the lenders only though a ‘flash report’ has been accepted by all the banks.

Apart from SBI, the other lenders to the troubled Kolkata-based DI pipes and casting manufacturer, promoted by the Kejriwal family, include Punjab National Bank around Rs 400 crore, Srei Infra about Rs 440 crore, Indian Overseas Bank has around Rs 350 crore exposure, Oriental Bank of Commerce and UCO Bank have given over Rs 300 crore each to the company.

The group flagship Electrosteel Castings is the holding company of Electrosteel Steels with 39 per cent stake, and bankers want guarantees from this company for the CDR to go through.

According to the source, the promoters are not keen on providing corporate guarantees but are ready to offer personal guarantees.

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