Itc Set To Receive Rs150cr Loans From Idbi, Iibi

Tobacco major ITC Ltd is set to receive term loans in excess of Rs 150 crore from two development financial institutions -- the Industrial Development Bank of India (IDBI) and the Industrial Investment Bank of India (IIBI) -- shortly.

According to FI sources, IDBI is on the verge of finalising sanctions for assistance of over Rs 100 crore presumably in the form of non-convertible debentures. The IIBI too has recently completed sanctioning a term loan to the tune of Rs 50 crore.

"We expect to disburse it shortly," said the FI source.

Top ITC sources confirmed that they had approached the financial institutions for funds which were medium term borrowings.

 

"We had requested the financial institutions to explore various options and structure the instruments which would suit our requirements. These are normal borrowings under various heads. We are expecting an answer from IDBI soon," the source said.

ITC's credit worthiness received a fillip recently after it recorded an almost 70 per cent growth in its financial performance in the third quarter of the current fiscal. Besides, it also successfully financed the ailing ITC Classic sale to ICICI and finally got out of the financial services which was proving to be a substantial financial burden.

ITC and the ICICI are in the process of discussing the modalities of the number of workers that will ultimately be absorbed from ITC Classic into ICICI.

ITC, which is currently concentrating on tobacco, hotels and real estate, paper and packaging, and exports has, in line with its growth plans reshuffled the portfolios of its executive directors, and inducted two new directors.

The board consists of chairman Y C Deveshwar, Biswadev Mitter, Saurabh Misra, Anup Singh and S S H Rehman. ITC also has non-executive directors from financial institutions and outside directors Ram Tarneja and B Vijayraghavan. Mukesh Palta, who is currently serving as managing director ITC Classic, is expected to return to ITC after the amalgamation process is over.