Saraf and Partners Facilitates Equity Transfer for Highway Projects

Saraf and Partners acted as legal advisors to consortium of banks and financial institutions led by ICICI Bank Limited (Lenders) in the transfer of management control and 100% equity in Sadbhav Bhavnagar Highway Limited (SBHL) and Sadbhav Una Highway Limited (SUHL) from Sadbhav Infrastructure Projects Limited (SIPL) to Kalthia Engineering and Construction Limited (KECL) (and its subsidiaries) (Kalthia Group).

The Lenders had given term loan facilities to SBHL and SUHL earlier, and as a security for that, SIPL, as the previous 100% equity shareholder of SBHL and SUHL and as a third-party security provider, had pledged its whole shareholding in SBHL and SUHL, in favour of Catalyst Trusteeship Limited, acting for the benefit of Lenders, as security trustee.

The transfer of 100% equity of SBHL and SUHL from SIPL to KECL and its subsidiaries involved the temporary release and later re-creation of security interests over the pledged shares, which required careful drafting and negotiation of transaction documents.

To make possible the temporary release of security as above, the team, structured the proposed transaction and prepared and finalised specialised documents and agreements keeping the Lenders’ interests in mind. The Firm also provided essential support to the Lenders in terms of managing the transaction, helping and overseeing execution of the transaction documents. The transaction required brainstorming so as to provide a structure that was acceptable to all the parties to the transaction so that the execution could be done in a timely manner.

The team worked tirelessly, had several discussions on the obligations of the SIPL and Kalthia Group, diligently tracked negotiation points of all stakeholders, answered various queries raised by the parties involved, through research on legal aspects, during the transaction. All of which were successfully closed by the team within a very short time frame.

Saraf and Partners’ team was led by Partner Designate, Satyadarshi Kunal. Partner, Abir Lal Dey provided some strategic inputs on a few aspects of the transaction.