Lenders ask Suzlon to bring in Rs 250 cr for debt recast

K. Ram Kumar
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Agree to restructure Rs 10,829-crore loan

Suzlon Energy’s lenders have asked its promoter to bring in Rs 250 crore in two equal instalments if they are to restructure the company’s Rs 10,829-crore debt.

Even as its debt recast proposal under the corporate debt restructuring mechanism has been approved, lenders also want Suzlon to sell its non-core assets and realise receivables from debtors, said a banker clued in to the development.

Twenty-one banks and financial institutions, including State Bank of India (exposure: Rs 1,804 crore), IDBI Bank (Rs 1,692 crore), Punjab National Bank (Rs 857 crore), Indian Overseas Bank (Rs 855 crore), Bank of Baroda (Rs 845 crore) and Life Insurance Corporation of India (Rs 622 crore) have loan exposure to the wind energy major.

Suzlon’s problems on repaying its debt are because of the delay in getting $206 million from the US-based wind energy company Edison Mission and delay in sale of its wholly-owned Chinese subsidiary Suzlon Energy (Tianjin) Ltd to China Power (Tianjin) New Energy Development Ltd (deal size $60 million).

Further, the wind turbine manufacturer is facing delay in getting cash from German subsidiary REpower. This is because REpower’s cashflows have been ring-fenced by German lenders.

On Tuesday, the shares of Suzlon Energy Ltd ended 10 per cent up at Rs 17.05 on the BSE, against the previous close of Rs 15.50.

(This article was published on November 27, 2012)
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