1. For Jaiprakash Power bondholders, it’s February all over again

For Jaiprakash Power bondholders, it’s February all over again

Debt-ridden Jaiprakash Power Ventures said on Tuesday it may once again seek board approval for a standstill agreement with bondholders to extend the deadline to repay money it owes them.

By: | Mumbai | Published: February 10, 2016 1:51 AM
(Screen shot)

In September last year, Jaiprakash Power sold its Karcham Wangtoo and Himachal Baspa II hydropower units to JSW Energy for an enterprise value of Rs 9,700 crore.(Screen shot)

Debt-ridden Jaiprakash Power Ventures said on Tuesday it may once again seek board approval for a standstill agreement with bondholders to extend the deadline to repay money it owes them. Foreign currency convertible bonds (FCCBs) issued by the company in February 2010 are due for redemption on February 13 after the company negotiated a similar agreement in February last year.

Since then it has paid bondholders close to $125 million and owes them another $101.41 million. The FCCBs have a conversion price of Rs 85.81 per share. On Tuesday, shares of JP Power Ventures closed at Rs 5.98 on the BSE. In early February 2010, when the company issued FCCBs, the stock was trading at close to Rs 68.

In a filing to the stock exchanges, the company said, “With reference to the earlier letter dated February 01, 2016 informing about holding of next Board Meeting on February 11, 2016, inter alia, to consider Quarterly Results, Jaiprakash Power Ventures Ltd has now informed BSE that the Board in that meeting shall also be apprised of the possibility of signing a standstill agreement with a majority of the holders of outstanding FCCBs issued by the Company, since the Company may require additional time beyond February 13, 2016 to repay the FCCBs in full.”

At the end of March 2015, the consolidated net debt stood at Rs 31,409.73 crore, according to Bloomberg data.

In September last year, Jaiprakash Power sold its Karcham Wangtoo and Himachal Baspa II hydropower units to JSW Energy for an enterprise value of  Rs 9,700 crore. Analysts observed at the time that the asset sale was necessitated by high interest costs and and losses on account of its coal blocks for the 1.3 GW Nigrie project being cancelled. In addition, the company also signed an MoU with JSW Energy to sell its 500 MW Bina thermal plant in Madhya Pradesh for which the due diligence is understood to be in process. The company has synchronised the 1.9 GW Bara plant which is expected to be commissioned by March.

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