The Hindu Business Line : Sujana Metal gets IDBI nod for debt revamp

The restructuring includes reduction of interest rate on term loans, moratorium of loan repayment, interest deferment, waiver of funded interest and liquidated damages.

IDBI has agreed to reduce the interest on term loans to 8 per cent a year with effect from April 1, 2003 from the previously sanctioned rates varying from 16 per cent to 20 per cent, the company said in a release here on Thursday.

As per the restructuring, the core principal of Rs 70.85 crore has to be repaid in 40 quarterly instalments from October 1, 2006. The company will have the benefit of moratorium on loan repayment till October 1 next year.

The financial institution has agreed to fund the interest from April 1, 2003 to September 30, 2005 on a simple interest basis on core principal. The restructuring enables deferred interest of around Rs 18.5 crore carrying zero interest to be repaid in 50 monthly instalments from October 1, 2016. IDBI has also agreed to waive funded interest and liquidated damages to the tune of Rs 4.64 crore.

According to the company, in view of the restructuring, its outstanding loan portfolio would stand reduced by about Rs 29 crore. The book value stands enhanced by about Rs 12 per share. The interest charged for the current year will come down from Rs 18 crore to Rs 5.3 crore with savings of Rs l2.7 crore. There will be corresponding savings in subsequent years. The earnings per share stand enhanced by Rs 5.30 per share. There will be no cash outflow for the current year towards principal or interest. Currently, a detailed analysis of the restructuring package is being carried out.

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