Suzlon eyes long-term loans, QIP to trim debt
MUMBAI : Wind turbine maker Suzlon Energy Ltd is looking to refinance its ₹2,000 crore debt through equity and loans, according to two people familiar with the matter. The company on Friday said its board has approved raising up to ₹2,000 crore through a qualified institutional placement to repay debt and for growth capital. It has also been in talks with foreign banks and non-banking financial companies to raise long-term debt.
“Between debt and equity, the company has to raise ₹2,000 crore. By the first week of August, clarity will emerge on the nature of fundraising. Management is clear the company has to reduce debt on the balance sheet.
The company will look at partly repaying debt due to Rural Electrification Corp. (REC)," one of the two people cited above said, adding the company has strong interest from equity investors for the QIP. Last year, State Bank of India, along with 15 other banks, sold over ₹8,000 crore of Suzlon Energy loans to REC and the state-owned Indian Renewable Energy Development Agency (Ireda) as part of a balance-sheet clean-up.
After this, the company was declassified as a defaulter on the books of banks. Suzlon plans to raise equity at the listed parent company level; and is talking to banks to raise debt on the books of subsidiary Suzlon Global Operations and Maintenance Services (GOMS), which manages assets worth $12 billion. “Suzlon will borrow in their subsidiary, which is the operations and maintenance (O&M) company and upstream the cash to the parent to ensure repayment of the parent facilities by the two lenders.
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