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Debt-laden IL&FS has requested liquidity support from its promoters – Life Insurance Corporation of India and State Bank of India – to repay debts since the company’s planned assets sales will take some time to materialise. This comes even as a group subsidiary, IL&FS Financial Services Ltd (IFIN), on Saturday, disclosing more defaults in payment obligations on term loans and non-convertible debentures (NCDs) aggregating ₹243 crore.
Hari Sankaran, Vice Chairman and Managing Director, IL&FS, reiterated the institution’s three-pronged strategy, which was disclosed in an August 29 statement.
“In today’s [31st] annual general meeting of IL&FS, we addressed several of the issues concerning our shareholders. These issues revolved around how we can restore normalcy to our operations....we sought support of shareholders in this endeavour.”
On August 29, the board of directors of IL&FS had approved a rights issue of 30 crore equity shares at ₹150 per share aggregating to ₹4,500 crore to shore up the company’s capital. The rights issue is expected to be completed by October 30.
Meanwhile, IFIN said it was unable to service its obligations with respect to term loan (₹71.33 crore), interest payment of NCD Series 2017 XIII (₹8.69 crore), and interest and principal payment of NCD 2015 Series I (₹162.91 crore), the company said in a stock exchange notification.
On September 28, IFIN said it was unable to service its obligations in respect of term loan (₹100.72 crore), commercial paper (₹28 crore), interest payment of NCD Series 2012 IV (₹4.77 crore), and interest payment of NCD 2017 Series XIV (₹8.22 crore).
On September 27, IFIN said it was unable to service its obligations in respect of bank loans, including interest (₹284.5 crore), term deposit (₹103.5 crore), and short-term deposit (₹52.43 crore).
The non-banking finance company has defaulted on commercial papers (CPs) due on September 24 and 26. On September 18, IFIN informed the exchanges that CPs, which were due on September 14, could not be serviced in full on due date.
The same were settled on September 15 by the company. Further, the CPs, which were due on September 18, could not be serviced by the company.
As per the Reserve Bank Commercial Paper Directions, 2017, the company cannot access CP market up to six months from the date of repayment of its obligations.
All these defaults come in the backdrop of credit rating downgrades and resignations of five directors and managing director of the company.
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