Lanco Infratech Ltd is in the process of restructuring its corporate debt. According to company sources, the holding company will restructure about Rs 7,500-crore debt.
The company has an overall debt exposure of close to Rs 34,000 crore. This includes Rs 17,000 crore at the holding company level and another Rs 17,000 crore at its special purpose vehicles.
The listed entity is in talks to part-divest stake both at the holding company level and also in its SPVs. However, due to market conditions and poor sentiment in the infrastructure sector, the deals are getting delayed.
Lanco Infratech has informed the BSE that the company has initiated the process of corporate debt restructuring as prescribed by the Reserve Bank of India.
The CDR mechanism permits viable companies time to meet debt obligations, subject to certain terms and conditions.
Several infrastructure companies are faced with tough business environment, including high interest rates and liquidity concerns. Some companies have either concluded a debt recast or are in negotiations to restructure their finances.
Companies such as Lanco Infra, which are facing fuel shortage, both gas and coal, are finding the going tough. Lanco Infra is facing delays even in recovering dues worth close to Rs 3,000 crore from State electricity boards.
During recent interactions, the company management had indicated that they were banking on stake divestment to reduce debt and free up equity for new projects. However, these did not materialise.
The company is likely to make a detailed announcement after its board meeting and interaction with its lenders.