Mumbai, Mar 2 (PTI) To speed up the debt resolution for the IL&FS group entity CNTL, the lenders led by State Bank of India will meet shortly to evaluate and vote on the new resolution plan that the firm has proposed at a valuation of Rs 5,257 crore.
CNTL, which owes a little over Rs 5,500 crore to the lenders, had entered into a share sale agreement with the Singaporean infra major Cube Highways & Infrastructure in August 2020 for a Rs 3,900 crore-deal. However, the agreement lapsed last August following which the management appointed an external valuer.
At the new valuation of Rs 5,257 crore arrived at by the external valuer, the secured lenders would get 99.2 per cent of their claims while unsecured ones will get 90 per cent of their principal amount, a source in the know told PTI on Wednesday.
According to the source, State Bank of India-led lenders will meet shortly to evaluate the new resolution plan.
An IL&FS spokesperson declined to comment.
CNTL or the Chenani-Nashri Tunnel Project, is an arm of IL&FS Transportation Networks.
The new valuation of Rs 5,257 crore is higher by Rs 1,300 crore compared to the bid by Cube. The earlier valuation of CNTL was done in 2018 and under duress. Since then, the collection from the tunnel traffic has improved.
At the meeting held over the last weekend, the lenders unanimously approved appointment of Crisil and Icra as rating agencies, SKVM as the forensic auditor, and RBSA as the valuer, the source said.
All these appointments are required to be completed by the lenders to approve the new restructuring proposal put forth by the company which values CNTL at Rs 5,257 crore.
As per the current proposal, the lenders would receive an upfront payment of around Rs 1,300 crore in the form of interest and principal in addition to Rs 670 crore already debited by them, the source said.
According to the source, the proposal presents a much-enhanced recovery for all the lenders with secured lenders getting around 99.2 per cent and the unsecured creditors getting 90 per cent of their principal. This is in addition to interest accrued from April 2021 providing substantial benefit of around Rs 300 crore to the lenders.
The Chenani-Nashri Tunnel is part of the ambitious 286-kilometre-long four-laning of the Jammu-Srinagar National Highway to make it an all-weather highway between Chenani and Nashri. The section otherwise remains closed for about 40 days a year due to bad weather.
IL&FS proposes to complete restructuring and start servicing all lenders before the end of this month, when the term of the government-appointed board led by Uday Kotak also ends.
CNTL continues to maintain and operate the longest tunnel in J&K and is receiving an annuity of Rs 635 crore annually. All annuity payments are being received on time.
Last November, PTI had reported that IL&FS was seeking a new buyer for CNTL after the deal with Cube fell through due to delays.
The two-lane Chenani-Nashri tunnel was launched with a project cost of Rs 5,269 crore in March 2017 with concession period up to March 2032. The project got over two dozen bidders and Cube’s Rs 3,900 crore offer was the highest.
In November last year, Kotak had said that as of the end of October 2021, the ILFS Group had resolved Rs 52,200 crore of its Rs 99,000 crore of fund-based and non-fund based debt (as of October 2018) spread across 347 group companies.
Of the total cases addressed, Rs 14,100 crore was repaid to creditors, wherein some creditors got full recovery and some others got much lower. And the group was sitting on a cash balance of Rs 16,700 crore. PTI BEN ANZ RAM
