Lanco Infratech Ltd has entered into a master restructure agreement with lenders, infusing fresh capital of Rs 152 crore, while it is in talks to divest stake in some of its assets.
The agreement has been inked between Lanco Infra and most of the banks, part of a consortium of 25 bankers headed by IDBI.
The diversified infrastructure company had applied for corporate debt restructure process for its Rs 7,500-crore debt at the holding company and had sought Rs 3,500 crore towards working capital. Both these were approved during the meeting of the CDR Empowered Group on December 11.
The company has accumulated a debt of over Rs 36,000 crore at the holding company level and at various special purpose vehicles. It has knocked at the CDR cell to rejig its debt at the holding company level.
“As a part of the deal, the company has infused fresh equity and also plans to divest stake in some of the power projects,” T. Adibabu, Chief Operating Officer of Lanco Infratech, told Business Line .
The projects under consideration of divestment include Udipi thermal power project, Budhil hydel project and its projects in the solar power division and also stake in two highway projects in Karnataka.
While majority of the lenders have inked the agreement, a couple of bankers are awaiting final nod from their management to finalise the transactions, he explained.
According to the company, the working capital money will ease up the liquidity situation and help pay some of the pending dues to its suppliers and also revive work at some of the EPC projects. The debt restructure enables the company get a breather in terms of loan payments.
The company has posted loss in past several quarters as its gas plants located in Andhra Pradesh are unable to function due to lack of gas supply and its thermal power plants have been hit due to inadequate coal supplies and EPC work had slowed down. All these have impacted the cash flows significantly.
He said, “Negotiations for stake sale are now underway and we hope to conclude them in few weeks. These are for Budhil where two companies are in talks and for Udipi too, where both domestic and international players are interested.”