The wind turbine maker additionally handed an enabling decision for conversion of mortgage and debentures into fairness. It didn’t disclose the quantum of the debt that will be transformed.
“The board has accepted the corporate’s proposal for restructuring of debt of the corporate and its sure recognized subsidiaries formulated underneath the Reserve Financial institution of India (Prudential Framework for Decision of Pressured Property) Instructions, 2019 issued by Reserve Financial institution of India vide its round dated seventh June 2019,” the corporate mentioned within the assertion.
The corporate will concern to its lenders as much as 100 crore fairness shares, as much as 410,000 0.01% secured optionally convertible debentures of Rs 100,000 every, and as much as 50 crore warrants of Rs 1 every.
Individually, the board additionally accepted an enabling decision to concern shares or fairness linked devices Rs 1,000 crores, which can be raised later if required.
Suzlon Power mentioned it has additionally obtained approval on the market of belongings.
Suzlon will even concern fairness or obligatory convertible debentures of the corporate on preferential foundation to the promoters and another entities price Rs 400 crore.
Final yr, Suzlon defaulted on mortgage repayments and its loans have been categorised as non-performing belongings by lenders. In July 2019, Suzlon’s secured collectors signed an inter-creditor settlement to resolve the debt disaster by working with the corporate. In keeping with a central financial institution directive on June 7, such agreements have to be signed inside 30 days of the primary default to any lender. Banks have a 180-day window, which ended on January 6 to resolve the difficulty.
This was the second occasion of a significant default within the 24-year lifetime of the Indian wind turbine maker. In 2012, it had defaulted on FCCB reimbursement, the largest of its sort on the time. The bonds it defaulted on in July have been, actually, issued in alternate for one of many sequence on which it had defaulted at the moment.
In 2013, Suzlon underwent a company debt restructuring for its Rs 9,500 crore loans because it confronted extreme liquidity crunch and couldn’t service debt. In 2015, billionaire Dilip Shanghvi got here in as a white knight, shopping for a 23% stake. However the firm’s issues continued because the Indian authorities rolled again incentives to the wind power sector, the market shrank and competitors intensified at the same time as debt remained excessive.
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