IL&FS moves closer to asset monetisation

New Delhi: In a comforting move for lenders, and inching closer to asset monetisation, IL&FS has signed 'Binding Term Sheet' with lenders of three entities as part of its resolution process.

The entities for which the binding term sheet has been signed include Moradabad Bareilly Expressway Limited, Jharkhand Road Projects and West Gujarat Expressway Limited.

These three entities have now been moved from 'amber' to 'green', as per the National Company Law Tribunal (NCLAT) order on July 12.

These entities would also be eligible for getting reliefs already granted to "existing green" entities, as per the order passed by the NCLAT on February 11, 2019.

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

Total debt across these three entities is about Rs 5,071 crore -- Rs 3,242 crore from secured lenders and Rs 1,829 from unsecured lenders.

Secured lenders of Moradabad Bareilly Expressway Limited, Jharkhand Road Projects and West Gujarat Expressway Limited have approved revised proposal for these entities by way of signing these binding term sheets

Revised proposal involves certain concessions and modification of terms of financial debt, availed by these entities from lenders, including release of cash flow from existing accounts to service financial and operational creditors; reduction in debt service coverage ratio requirement; utilization of surplus cash (above DSCR requirement); preference to secured lenders over unsecured lenders in case of shortfall; and revision in interest rate charged to the entity.

Major secured lenders in MBEL include India Infra Debt Limited, L&T Infrastructure Finance Company Limited, L&T Finance Limited, L&T Infra Debt Fund Ltd, Bank of Baroda and Bank of India with overall debt of about Rs 1,567 crore.

Jharkhand Road Project is undertaking developments of 5 road projects on BOT basis and its major secured lenders include India Infra Debt Limited, L&T Infra Debt Fund Ltd, Aditya Birla Sun Life Mutual Fund (represented by Aditya Birla Sun Life AMC Limited), Aditya Birla Health Insurance and Capital Asset Fund with an aggregate debt of approximately Rs 1,545 crore.

West Gujarat Expressway has been awarded project to develop design finance construct operate and maintain 68 km Jetpur and Rajkot bypass including Rajkot bypass on NH8B in Gujaat and its major secured lenders include L&T Infrastructure Finance Company Limited and L&T Infra Debt Fund Ltd with aggregate debt of about Rs 129 crore.