The IL&FS group has entered into term-sheets with its secured lenders for three of its road entities as part of its resolution process, the company said on Monday. The three entities will now move to the green category.
“Secured lenders of Moradabad Bareilly Expressway, Jharkhand Road Projects, and West Gujarat Expressway have approved the revised proposal for these entities by way of signing these binding term sheets,” the group said in a statement. Total debt across these three entities is around Rs 5,071 crore, of which Rs 3,242 crore is from secured lenders and Rs 1,829 from unsecured lenders.
The revision allows for concessions and modification of terms of financial debt and release of cash flow from existing accounts to service financial and operational creditors. The revised terms includes preference to secured lenders over unsecured lenders in case of shortfall, and revision in interest rate charged to the entity. Other changes include reduction in debt service coverage ratio requirement (DSCR) and utilisation of surplus cash (above the DSCR requirement).
The revision in terms, the company said, allows moving these road subsidiaries to Amber to Green. IL&FS group companies have been classified between Amber, Red and Green, depending on its cash crunch or the lack of it.
“These three entities would also be eligible for getting reliefs already granted to ‘existing green’ entities, according to the order passed by the National Company Law Appellate Tribunal (NCLAT) on February 11, 2019,” the IL&FS said, adding that this will help the Board in its asset monetisation process.
India Infra Debt, L&T Infrastructure Finance Company, L&T Finance, L&T Infra Debt Fund, Bank of Baroda and Bank of India are secured lenders to the Moradabad Bareilly project, with a debt exposure of Rs 1,567 crore.
Debt for the Jharkhand Road Project stands at Rs 1,545 crore, with India Infra Debt, L&T Infra Debt Fund Ltd, Aditya Birla Sun Life Mutual Fund, Aditya Birla Health Insurance and Capital Asset Fund as secured lenders. L&T Infrastructure Finance Company and L&T Infra Debt Fund also have a combined debt exposure of Rs 129 crore to the West Gujarat Expressway project.