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Three IL&FS entities turn green after signing terms sheet with lenders

This will help the IL&FS board in its stated objective of asset monetisation

Press Trust of India  |  New Delhi 


Three group companies have moved to green list after signing term sheet with the lenders to their debts worth Rs 5,071 crore, the was informed on Thursday.

The three companies -- Moradabad Bareilly Expressway (MBEL), Jharkhand Road Projects Implementation Company (JRIPIC) and West Gujarat Expressway (WGEL) -- have moved to green list from the amber list of group companies.

This will help the board in its stated objective of asset monetisation.

A two-member bench headed by Chairperson Justice S J Mukhopadhaya has directed to list the case on November 18 for next hearing.

The binding term sheet has a revised proposal for debt-restructuring, with certain concessions and modification of terms of financial debt.

This also includes release of cash flow from existing accounts to service financial and operational creditors, and reduction in debt service coverage ratio requirement, senior advocate Ramji Srinivasan appearing for IL&FS informed the National Company Law Appellate Tribunal (NCLAT).

So far, 150 IL&FS entities have been identified, in which 55 are in green, 82 in red and 13 in amber.

As per the roadmap for IL&FS, which has a total debt of over Rs 90,000 crore, its group companies have been categorised into three verticals -- Green, Amber and Red -- based on their respective financial positions.

Companies under the green category will be those that continue to meet their payment obligations.

Amber category is for those companies that would not be able to meet their obligations but can meet only operational payment obligations to senior secured financial creditors.

Amber category entities "are permitted to make only payments necessary to maintain and preserve the going concern".

"Companies falling in the red category are the entities which can not meet their payment obligations towards even senior secured financial creditors," as per the plan.

Such entities are permitted to make payment necessary to maintain and preserve.

The entire resolution process is based on the principles enunciated in the Insolvency and Bankruptcy Code.

The IL&FS group has 302 entities, of which 169 are in India and the rest 133 are overseas.

First Published: Thu, September 19 2019. 22:08 IST