Cyril Amarchand Mangaldas, India’s largest corporate law firm, advised Murugappa Group in the acquisition of a controlling stake in CG Power & Industrial Solutions Limited (“CG Power”). Tube Investments of India Limited (Tube Investments), part of the Murugappa Group, has acquired controlling interest in CG Power and entered into agreements for settlement of lender liabilities through a binding swiss challenge bid under RBI’s directions for resolution of stressed assets. The transaction involved preferential allotment of shares and warrants to Tube Investments under the new SEBI Regulation [Regulation 164A of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018], for resolution of stressed assets and settlement of existing debt of CG Power. Tube Investments had entered into securities subscription agreements with CG Power for subscription through preferential allotment of equity shares and warrants of CG Power to acquire majority stake in CG Power. The transaction is a landmark one being the first one under new SEBI regime for preferential allotment for distressed companies and was the first swiss challenge debt resolution of a listed company enabling a path for successful revival of CG Power. The General Corporate, Financing, Taxation and Disputes teams of Cyril Amarchand Mangaldas advised on the transaction. The transaction was led by L. Viswanathan (Partner). The Corporate team was led by Gautam Gandotra (Partner) with support from Arnav Shah (Principal Associate) and Ananya Pandit (Associate). The Financing Team was led by Amey Pathak (Partner), with support from Varun Singh (Senior Associate). The Taxation and Disputes advisory was provided by SR Patnaik (Partner), and Faraz Sagar (Partner) respectively. The preferential allotment of equity shares and warrants is valued at INR 800 crores approximately. The debt resolved is INR 4000 crores approximately. Other Parties and Advisors to the Transaction included Arpwood Capital (advisors to the Deal) and SBI Caps (financial advisors for the lenders).

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