India’s debt-ridden Infrastructure Leasing and Financial Services (IL&FS) said on Sunday that Japan’s Orix Corp has expressed an interest in buying out the remaining 51% stake in IL&FS’s wind energy assets.
Orix will utilise its right under the terms of an existing pact with IL&FS (Infrastructure Leasing & Financial Services Ltd) wherein Orix can match the price offered by the highest bidder to buy Iwel’s stake in the wind power plants, IL&FS.
In April, state-run gas utility GAIL (India) Ltd had offered to pay ₹4,800 crore (as enterprise valuation) for the 874-megawatt (MW) wind portfolio, subject to Orix agreeing to the sale. Orix, however, has now cleared out to buy out the remaining 51% stake by matching GAIL’s offer. The sale process to Orix is anticipated to be accomplished by June, subject to necessary approvals, according to the statement.
IL&FS group had cumulative a debt of more than ₹99,358 crore as of September 2018. Its default on debt payments caused a liquidity crisis in non-banking financial companies in India. IL&FS Group, in its statement, added that this development is a key step in the resolution process of IL&FS Group, being undertaken by the new board of IL&FS. While ORIX’s intent is a positive development for IL&FS, it will be a setback for GAIL’s renewable strategy.
The completion of sale of special purpose vehicles to Orix will be subject to satisfaction of all compliances and approvals required under applicable laws including approval of justice (retd.) D.K. Jain and the National Company Law Tribunal in accordance with the proposed resolution framework, IL&FS said.
The sale process for assets in areas such as education, funds, domestic roads, thermal power, water infrastructure, technology and key international assets is currently underway and binding financial bids are expected for these companies/businesses in stages by July 2019, the statement said.