IL&FS resolves Rs 55,000 cr debt till March-end, chairman Uday Kotak's term ends

As part of periodic update on the ongoing resolution, the Infrastructure Leasing & Financial Services (IL&FS) on Tuesday stated that it has resolved debt amounting to Rs 55,000 crore as of March-end, up from Rs 52,200 crore as of November 2021.

Along with that, banker Uday Kotak who had been appointed non-executive chairman of IL&FS as part of a board constituted by the government, will step down as his term ends on April 2, 2022. CS Rajan will take over as chairman thereafter. "We have received the official word from the government regarding this transition," Kotak said.

The group retained its overall resolution estimate at Rs 61,000 crore, representing 62 per cent of overall -- fund based and non-fund based -- debt of over Rs 99,000 crore as of October 2018. Resolution of remaining Rs 6,000 crore debt will move into FY23.

This overall resolution estimate of 62 per cent is double the average recovery of 31 per cent under IBC, the company said in a statement.

"This has been largely possible due to the continued commitment of the New Board and the Management to preserve value in assets of national importance and maintaining going concern status," it added.

Of the 347 entities under IL&FS Group as of October 2018, a total of 246 entities stand resolved leaving 101 entities to be resolved in the next financial year.

Further, the debt-ridden company also informed that an application has been filed with NCLAT for undertaking interim distribution of Rs 16,000 crore of cash and InvIT units available across the Group. Over 75 per cent of this would be distributed to creditors of three large holding companies - IL&FS, IFIN and ITNL - which have a large base of public fund creditors. This has been made possible on account of IL&FS’ resolution framework and the underlying distribution formula.

Moreover, it also stated that its headquarters at BKC, Mumbai has been sold to Brookfield for Rs 1,080 crore. The letter of Intent has been given to Brookfield and the asset to be handed over in 2022.

"The incremental resolution of over Rs 2,700 crore since November 2021 comprises of Rs 1,080 crore from sale of IL&FS Headquarters (TIFC) in BKC Mumbai, Rs 900 crore under Khed Sinnar claim settlement with NHAI, Rs 230 crore from settlement of IFIN’s non-performing loan accounts and Rs 520 crore from other recoveries."

In addition, the group continues to service debt of Rs 1,000 crore across companies. ITNL completed transfer of two road assets (Sikar Bikaner Highway Limited and Moradabad Bareilly Expressway Limited) to Roadstar Infra Investment Trust at a cumulative enterprise valuation of Rs 4,200 crore, it added.