Troubled infrastructure financier Infrastructure Leasing and Financial Services will sell its Chinese road asset for nearly Rs 2074 crore to PingAn Insurance (Group) Company of China, two people familiar with the development said. This sale will help resolve debt worth Rs 2500 crore.
The group has also received approval from Supreme Court Justice (Retd) D K Jain to sell its Chinese JV Road Asset – Chongqing Yuhe Expressway Co Ltd (CYEC) – to PingAn. PingAn Group is amongst the largest financial services companies in the world.
IL&FS owns 49% in the asset through a Singapore subsidiary ITNL International Pvt Ltd (IIPL) while Chongqing Expressway Group held the balance 51%. PingAn emerged highest bidder and bid $281 million for 100% stake in CYEC. Sale proceeds would be used to pay the senior secured lenders in IIPL, the bondholders and unsecured inter-corporate loans.
Justice D K Jain, appointed by court to oversee IL&FS resolution process, recently granted approval to sell Chenani Nashri Tunnelway Limited to Cube Highways addressing Rs 4910 crore debt and Jorbat Shillong Expressway Limited to Sekura Roads addressing Rs 1600 crore debt.
Together, on completion, these three road asset will collectively address Rs 9,000 crore debt, subject to approval of the National Company Law Tribunal and other regulatory approvals. IL&FS also proposes to address over Rs 8,000 crore of debt through the proposed InVit for which it has already received in-principle approval from the market regulator.
CYEC holds and operates a concession for a toll based expressway of approximately 58.72 km in China Mainland till 2032. The company has the right to collect toll from users and concessions from Chinese government for the remaining period of concession term.
The new board of IL&FS has maintained it will address overall debt of Rs 50,000 crore by end of this fiscal. The group addressed over Rs 19,000 crore at the end of the September quarter and had targeted to resolve additional Rs 13,000 crore by the end of December quarter.
Source: Economic Times