Sterling and Wilson Renewable Energy, which recently paid off dues to lenders on which it had defaulted, said its lenders, led by Union Bank of India, have approved its resolution plan which includes paying off accumulated debt through a fund raise.
At the end of September, the company had a net debt of ₹2,123 crore, while it had a negative net worth of ₹415 crore. In September, it had dues of ₹329 crore to various banks, but could repay only ₹194 crore and defaulted on the remainder. It could also only part pay a ₹250-crore working capital loan that fell due on September 30.
Subsequently, it was able to get ₹342.87 crore from promoter Shapoorji Pallonji and Company Pvt Ltd (SPCPL) under the terms of an indemnity agreement that had been entered into in 2021 between promoter selling shareholders SPCPL and Khurshed Daruvala and Reliance New Energy. The total claim under the indemnity agreement was ₹418.13 crore, which has now been fully recovered.
Fund raise
The company has taken board approval to riase up to ₹1,500 crore through the issue of securities, which will be used to repay the accumulated dues of the company.
The company also expects cash flows from revenue contracts where letters of intent have been issued or preliminary agreements signed. It has recevables of ₹2,395 crore from a subsidiary as well as refund of bank guarantees.
Reliance New Energy has a 40 per cent stake in Sterling and Wilson Renewable.