IL&FS Group entities IL&FS Financial Services and IL&FS Energy Development Company jointly hold 26% stake in ONGC Tripura Power (OTPL), while it has nearly 72% stake in IL&FS Prime Terminals FZC, the company engaged in development and operation of a bulk petroleum storage terminal currently servicing the port of Fujairah in the UAE.
The government-appointed new board of IL&FS Group has selected VTTI Terminals’ bid of $90 million or Rs 672 crore for the acquisition of its stake in IL&FS Prime Terminals FZC.
India’s largest state-owned natural gas processing and distribution company GAIL (India) has offered an equity value of Rs 319 crore for 26% stake held by IL&FS in ONGC Tripura Power (OTPL). In addition to this, GAIL has also agreed to assume all financial and operational liabilities of OTPL without any compromise of debt.
Apart from IL&FS, Oil and Natural Gas Corporation (ONGC) holds 50% stake in OTPL, while India Infrastructure Fund II managed by Global Infrastructure Partners and Government of Tripura own 23.5% and 0.5% in the company.
OTPL, counted among India’s largest gas-based power plants, has an operational capacity of 726.6 MW. The plant has also secured the majority of approvals to add two 363.3 MW units to its existing capacity and expand to a total capacity of 1,453 MW.
IL&FS holds 35% stake in WCBTRL through its subsidiary IL&FS Transportation Network Ltd, while other partners Vishvaraj Infrastructure and Diva Media Private Ltd hold 55% and 10% stake in the company. Of these partners, Vishvaraj Infrastructure has offered to pay Rs 12.25 crore to acquire IL&FS Transportation Network’s 35% stake in the toll road project.
Once all these three stake sale transactions are concluded, IL&FS will be able to resolve debt of around Rs 2,800 crore.
IL&FS is monetising its assets with an objective to manage debt obligations. The failure of IL&FS to meet repayment obligations in September 2018 had triggered a liquidity squeeze that gripped India’s non-banking finance companies. As part of a clean-up, the government replaced the IL&FS board, which has been engaged in trying to resolve its debt.
The Uday Kotak-led IL&FS board estimates overall recovery to be around Rs 61,000 crore, an upward revision to its earlier estimate of Rs 56,000 crore. Improved valuations, better operating performance, enhanced recoveries from non-group exposures are driving higher recoveries.
The new board expects around 95% or Rs 57,000 crore worth estimated recovery to take place by March 2022. It has already resolved an estimated recovery worth over 52,000 crores as on October end. The recovery estimate includes through both, resolution and liquidation.
