Unitech settles three-fourth of debt worth Rs 2,500 cr

The country's second largest realty firm, Unitech, today said it has repaid or rescheduled about three-fourth of the company's debt worth Rs 2,500 crore to be paid by March 2009.

"We have to repay only 20-25 per cent of Rs 2,500 crore which is to be paid by March 2009," Unitech Managing Director Sanjay Chandra told reporters after the Extra-ordinary General Meeting, which was called to take the shareholders' approval to raise up to Rs 5,000 crore through issue of securities.

Unitech will repay the remaining Rs 500-600 crore through asset sales and regular cash-flows, Chandra said. "We do not have substantial re-payment obligations for this fiscal, nothing that worries us."

The company has made substantial payments to mutual funds that was due today and the balance has been rolled-over. It had to re-pay Rs 900 crore toady to seven-eight mutual funds.

Also Read: Unitech restructures debt from mutual funds

Unitech, which has been reeling under financial crunch, had a total debt of about Rs 8,000 crore till second quarter of 2008-09, of which Rs 2,500 crore is to be paid this fiscal.

Chandra said the company would replace Rs 2,500 crore short-term borrowing to long-term in the next two months.

"We are changing our borrowing profile from short term to long-terms. So from mutual funds, we are moving a lot towards banks and financial institutions who have more long-term capital," he said.

He highlighted that the rate of interest on fresh loans has come down to below 14 per cent from the maximum 17-19 per cent.

On the asset sales, he said the transactions would be closed shortly but did not give nay timeframe. Among the properties that are up for sale is an office building in the national capital and a hotel in Gurgaon.