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IVRCL to float two separate companies
Highlights
In a bid to bail out the ailing infrastructure company, IVRCL plans to split its engineering procurement construction (EPC) and assets – land and build operate transfer (BOT) – in to two separate companies.
Hyderabad: In a bid to bail out the ailing infrastructure company, IVRCL plans to split its engineering procurement construction (EPC) and assets – land and build operate transfer (BOT) – in to two separate companies.
In a filing, the company said its board has decided to call for a EGM to get it approved the conversion of part of the debt into equity shares of the company following debt restructuring by joint lenders forum.
"To carve out the business of the company into 'EPC Company' and 'Assets Company' which includes Land/BOT and other assets, by way of Scheme of Arrangement subject to receipt of "No objection letter" (NOC) from the lenders/Joint Lenders Forum, approval of High Court of Andhra Pradesh and Telangana and any other approvals as may be required," IVRCL said.
The company felt that the spinning off of EPC business would enable investment by potential equity investors. On December 1, the company said in a meeting Joint Lenders Forum, the lenders invoked Strategic Debt Restructuring (SDR) in the company.
Last year, it recast its Rs 7,300 crore debt under CDR package. Strategic debt conversion option will give lenders the right to convert their outstanding loans into a majority equity stake if the borrower fails to meet conditions stipulated under the restructuring package and take control of the company operations.
The banks are the major shareholders of the company holding 43.88 per cent of the equity, while as on June 30, the promoters' stake in the company stood at 8.7 per cent. The company is yet to disclose the promoters' stake as on September 30.
IVRCL also said the board has decided to further issue shares to certain CDR lenders on conversion of additional Funded Interest Term Loan amount (FITL).
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