Acquisition of financial assets by Sri Asset Plus ARC is governed by its Board approved Acquisition Policy. The Company mainly aims to acquire sub-standard / doubtful and loss assets, however, standard assets likely to face distress prospectively may also be considered for acquisition.
The Assets are acquired either on a cash basis or by issuing Security Receipts (SRs) or a combination of both. In case of cash purchase, assets are taken on the balance sheet of the Company, while in case of SRs, a trust is set up which holds the acquired assets. Sri Asset Plus ARC acts as the trustee. The trust issues assets backed SRs to the investor which may be the selling Bank & FIs, Sri Asset Plus ARC itself and/or any other Qualified Institutional Buyer.
The Company follows a structured and systematic approach towards acquisition of financials assets which includes but is not restricted to:
- Preliminary review of FAs proposed to be acquired in order to make EOI.
- Due Diligences such as Legal due diligence, valuations of FAs.
- Execution of required legal documents to complete the transaction.
- Issue of security receipts.
Sri Asset Plus ARC also performs the role of a bridge between potentially viable sick assets & the investors looking for avenues of investment in distressed assets.