The meeting of the consortium of lenders follows Altico Capital's interest payment default to the tune of Rs 19.97 crore on a Rs 340-crore external commercial borrowing by Mashreq Bank on September 12.
The consortium of lenders to Altico Capital India, a wholesale-focused non-deposit taking non-banking finance company, met on Monday to discuss signing the inter-creditor agreement (ICA) before they could start work on a proposal for debt resolution.
Further discussions on a resolution plan will be held at future meetings, bankers said. Alvarez and Marsal has been appointed by the company as the adviser for the restructuring exercise, bankers told FE.
The meeting of the consortium of lenders follows Altico Capital’s interest payment default to the tune of Rs 19.97 crore on a Rs 340-crore external commercial borrowing by Mashreq Bank on September 12.
The company’s total borrowing from banks and financial institutions stood at Rs 4,361.55 crore as of September 12. Meanwhile, data from Value Research show that mutual funds have an exposure of Rs 537.67 crore to Altico Capital India as on August 2019.
UTI Mutual Fund has an investment of Rs 333.84 crore in Altico across seven debt schemes, while Reliance Mutual Fund has an investment of Rs 203.83 crore, show the Value Research data. Both have decided to create a segregated portfolio in their respective funds which have exposure to debt instruments issued by Altico Capital India.
According to Emkay Global Financial Services, Altico’s loan book of Rs 6,900 crore, as of June 2019, has exposure to real estate developers, where in terms of life cycle, 31% of the loan book was attributable to early-stage funding of projects and about 70% was under moratorium.
Along with two other entities, including KKR, Altico has a combined exposure of Rs 900-1,000 crore to SARE Homes, promoted by London-based Duet Group, which was facing severe cash crunch due to unsold inventory.
Altico had an initial exposure of Rs 430 crore to Supertech in the NCR, and recently infused Rs 100 crore into Pharande Group, a struggling developer based in Pune.
The day after the company informed the exchanges of the default, India Ratings and Research downgraded the company’s long-term and short-term issuer ratings to ‘IND D’ from ‘IND A+’ and ‘IND A1’, respectively.