Suzlon wins Rs.11,000-cr debt recast
Suzlon Energy’s lenders have decided to restructure loans of R11,000 crore through the corporate debt restructuring (CDR) mechanism. Both State Bank of India (SBI) and IDBI Bank, the second largest lender to the Pune-based firm, seem to have agreed to a recast. The CDR cell typically requires 75% of banks (by value) and 60% of them (by number) to agree to a restructuring.
Finer details are expected to be worked out a meeting to be held next week but the company’s foreign currency convertible bonds (FCCB) will not be a part of the debt restructuring package, though lenders will factor in these liabilities.
Suzlon had earlier initiated discussions with its senior secured lenders and hopes to restructure its debt with a maturity period of ten years under CDR mechanism, including a two-year moratorium on principal and interest payment on term-debt. Bankers say the package will most likely involve additional lending to the company. Also, Suzlon chairman and managing director Tulsi Tanti is likely to bring in about R250 crore as promoter capital.
The main lenders to Suzlon are SBI with an exposure of R3,500 crore, IDBI Bank R1,700 crore, Bank of Baroda R1,000 crore and Indian Overseas Bank R1,000 crore. Some other lenders to the group with smaller exposures include ICICI Bank, Axis Bank, and Yes Bank.
The debt restructuring proposal came after FCCB holders rejected Suzlon's request to extend the time for redemption of FCCBs of $221 million due to
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