Bajaj Hindusthan Sugar on Friday said that the Overseeing Committee (OC) has approved its debt recast under the scheme for sustainable structuring of stressed assets (S4A) of the Reserve Bank of India (RBI). The company said in a regulatory filing that 57.81% of the total debt of Rs 8,284.59 crore has been found to be sustainable and the rest was unsustainable. “Promoters shall dilute their shareholding from the current level of 26.02% to 15.43% by way of sale of a part of its shareholding to the joint lenders’ forum (JLF) members,” the statement said, adding that the company will have a right of first refusal (RoFR) over the equity shares/optionally convertible debentures (OCDs) held by the JLF lenders.
Bajaj Hindusthan also said that the sustainable debt will be serviced out of its cash flows from operations, without any change in repayment terms. From the unsustainable debt, Rs 12 crore will be adjusted against the sale consideration payable by the JLF members to the promoters towards the dilution of stake. “The balance of `3,483.25 crore would be converted into OCDs as per the S4A resolution plan,” the statement said.
In the quarter ended September 2017, Bajaj Hindusthan reported a net loss of Rs 91.5 crore on revenues of Rs 1,506.5 crore. In FY17, the company reported a net profit of `7.4 crore on revenues of Rs 4,619 crore. Its total debt stood at Rs 5,703 crore in FY17.
In June, the company had said the JLF of the company at its meeting held on June 23, 2017 (reference date) has taken a decision that the loan account will be taken up for consideration under the S4A Scheme.
Lenders to the Uttar Pradesh-based company include State Bank of India (SBI), Bank of Baroda (BoB), Allahabad Bank, Central Bank of India, IDBI Bank, Punjab National Bank (PNB), among others.
The company is promoted by Bajaj family that directly own 2.62% and the rest through other entities, including Bajaj Resources (7.23%), Global World Power Project (3.63%) and Bajaj International Realty (2.45%).
Under the S4A scheme, which lenders see as among the more favourable resolution routes, the sustainable debt needs to be not less than 50% of the total debt implying a haircut of 50% or less. The scheme, however, does not permit changes in either the moratorium or the payment terms for either the principal or the interest.
Shares of Bajaj Hindusthan slipped by 0.85% on the Bombay Stock Exchange (BSE) on Friday, to close at Rs 15.10.