Suzlon Energy’s lenders will meet at Mumbai on Saturday to discuss the proposed terms of corporate debt restructuring (CDR) of the wind energy major.

The 21-bank consortium will deliberate on the various aspects of the debt restructuring plan before a final CDR package is submitted to the CDR cell, sources in the banking industry said. The proposed terms will include restructuring debt at Suzlon level, working capital enhancement to support business plans and shifting of servicing of overseas loans to REpower balance sheet.

Currently, the Suzlon Group cannot access the cash flows at REpower on account of tight ring-fenced financing by German banks. The cash flows can be accessed only after ring-fencing is removed.

As for restructuring debt at Suzlon level, the proposals on the table include extending tenor of existing facilities to 10 years (2+8) from existing repayment profile of 3-6 years. Also, reduction of interest rates to 11 per cent from 14-15 per cent will be discussed, sources said.

Suzlon Energy is understood to have a debt of about Rs 10,850 crore, which is now sought to be restructured. Bankers are also likely to discuss enhancement of fund-ased working capital by Rs 500 crore and non-fund based working capital by Rs 1,500 crore, it is learnt.

Srivats.kr@thehindu.co.in

(This article was published on December 7, 2012)
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