Lenders okay Suzlon's Rs 9600cr restructuring pkg: Sources

The wind turbine maker Suzlon can now heave a sigh of relief. Lenders have approved the company's Rs 9600 crore worth corporate debt restructuring package. As per the agreement, the company will repay USD 1 billion of dues to lenders by March 2016. CNBC-TV18’s Gopika Gopakumar reports. 

Sources say the company will get a moratorium period of two years on both interest and principal payments. There will be no additional funding from banks, but lenders have decided that during this two year moratorium period, when the interest will be waived off, it will be converted into a term loan. This term loan will again be converted into equity over these two years.
So, around Rs 1600 crore of loans will be converted into equity over that two year period. The promoters have also agreed to infuse Rs 250 crore into the company, Rs 125 crore in the first year and the next Rs 125 crore in the second year.
Banks have also ensured that the company repays around USD 1 billion of debt before March 2016, for that the company will not be looking at selling its German subsidiary which is RE Power, instead it will look at selling its non-core assets like SE Forge and SE Electrical. So, that is the detail from that end.
Also, on the Foreign Currency Convertible Bonds (FCCB) side the company which is outside of the corporate debt restructuring (CDR) package, the company is currently in talks with the FCCB bond holders to restructure or re-price these bonds. That is the update coming from Suzlon which is going to be big thumbs up for the company.