Essar Oil exits debt rejig facility

Essar Oil said it has received the approval for exiting the Corporate Debt Restructuring (CDR) loan facility set up in December 2004. The facility had helped construction of its refinery in Gujarat. The CDR facility will be replaced with a new debt of about Rs 9,400 crore on mutually acceptable terms from a similar group of lenders, the company said. “The exit will assist in the company enjoying greater operational and financial flexibility,” said Suresh Jain, Chief Financial Officer, Essar Oil. The Gujarat Government recently lifted its freeze on Essar Oil accounts. This followed Essar Oil complying with the Supreme Court direction to deposit Rs 1,000 crore with the state government for sales tax liabilities totaling Rs 6,169 crore. On July 23, Essar Oil tied up a credit line with banks for Rs 5000 crore to meet its tax liability.