Infrastructure Leasing and Financial Services (IL&FS) said that three of its group entities are set to begin servicing outstanding loans worth Rs 3,300 crore. In submissions before the National Company Law Appellate Tribunal (NCLAT), the debt-laden infrastructure development and financing company said that it has reached agreements with lenders to restructure debt, following which three of its group companies will begin servicing their debt, a report said.
According to a report by The Economic Times, IL&FS also told the appellate tribunal that it will seek similar agreements with lenders to begin servicing debts of 10 more group entities. These companies have been classified as 'amber', depending on their senior secured debt obligations and ability to meet operational payments. The total debt in the name of these entities amounts to Rs 13,000 crore.
The two-member NCLAT bench led by Justice SJ Mukhopadhaya granted IL&FS a window of 15 days to complete agreements for restructuring the debt of the 10 'amber' companies, the report said. The tribunal bench also questioned the group about its plans for resolution of entities under it marked 'red' - the ones that are not able to meet any payment obligations.
The counsel for IL&FS and Union of India told NCLAT that all lenders had signed term sheets with IL&FS for restructuring loan of West Gujarat Expressway and Jharkhand Road Project Implementation Company, the report added. The three IL&FS group companies will begin servicing their debts once the final documentation was signed.
Moreover, all lenders, expect Bank of India, had agreed to the restructuring of loans for Moradabad Bareilly Expressway, the report said. The public sector lender might agree to the terms in the next two days, it further added.
L&T Finance and its subsidiaries, along with Aditya Birla Sun Life Mutual Fund, are major lenders to the three IL&FS group companies that are going to service their debts. L&T Finance alone has an exposure of about Rs 1,500 crore in these firms.
The NCLAT bench also directed IL&FS to file an affidavit on the steps it would take to release payments to provident and pension funds. The bench noted that NCLAT may direct IL&FS and Union of India to release any funds generated to these and other employee-related funds who have invested in IL&FS group entities.