Lenders to Lavasa Corporation Limited, unit of Hindustan Construction Company (HCC) group, have invoked the strategic debt restructuring (SDR) plan to resolve the stressed assets of the firm.
Additionally, SDR has also been invoked on Lavasa’s two wholly owned subsidiaries – Warasgaon Assets Maintenance Limited and Warasgaon Power Supply Limited, HCC informed in a stock exchange filing.
The total debt of the company to be restructured is tentatively at about Rs 3,000 crore.
“The Reserve Bank of India’s bad loan resolution plan, SDR, - set up in 2015 - will involve lowering of company’s debt burden by converting a part of loans into equity, along with the implementation of the proposed business plan and infusion of fresh capital by a financial or strategic investor to implement the project and help protect the value of the asset within the timelines prescribed by RBI in its notification,” the filing said.
This was decided in the Joint Lenders Forum (JLF) meeting of the lenders of Lavasa Corporation Limited held on September 20, 2017, which is also reference date.
Lenders took note of the fact that due to a delay in implementation of earlier JLF approved structure, the project remained stalled for 2 years and an additional interest of around Rs 1,200 crore was accumulated and hence the release of working capital for the project needs to be resolved on priority, it said.
In January 2016, HCC Unit Lavasa had delayed interest payment on some NCDs.
In July last year, lenders to the parent firm HCC had proposed the latest (June 2016) RBI mechanism ‘Scheme for Sustainable Structuring of Stressed Assets (S4A) to resolve its debt, while in 2012, it entered into a Corporate debt restructuring (CDR) plan which failed to take off.
Lavasa Corporation reported a loss of Rs 166 crore for the year-ended March 31, 2017, as compared with a profit of Rs 269 crore in the previous year, the bank’s website said.
HCC has been attempting an IPO (initial public offering) for Lavasa Corporation since November 2010, but has been unsuccessful so far.
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