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| Suzlon resets loan covering for REpower purchase |
| Press Trust of India / Mumbai May 28, 2009, 13:24 IST |
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Suzlon Energy today said it has reset the covenants on the loan it took to buy German wind power firm REpower Systems.
"Suzlon has successfully renegotiated financial covenants and amended key terms of its senior bank loan facilities taken for the acquisition of REpower Systems AG in 2007," the company said in a filing to the Bombay Stock Exchange.
In 2007, Suzlon had tied up for euro 1,575 million debt facilities from a consortium of 24 international banks in order to fund the acquisition of REpower and Hansen Transmissions International.
As per terms of the renegotiation, the banks have relaxed the financial covenants for the balance tenure of the loan and would also include Hansen Transmissions International and its subsidiaries for the computation of the covenants.
Banking covenants are agreements between a company and its creditors which stipulate that the company should maintain the levels of interest cover, working capital and debt service cover so as to maintain the balance between debt and equity capital.
"As of March 31, the total outstanding against the said facility was euro 504 million funded facility and a euro 205 million guarantee facility," the filing added.
Shares of Suzlon were trading at Rs 92.40, up 2.95 per cent in the afternoon trade on the BSE.
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