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Lenders examine CDR option for Suzlon debt recast

According to reports, lenders to debt laden Suzlon Energy Ltd have begun to examine option to take company to corporate debt restructuring (CDR) sale to recast loans worth Rs 13,000 crore. This is step to avoid hit on bank balance sheets.

Senior Public sector bank executive said State Bank of India is leader of lenders and SBI Caps, its capital market subsidiary, had preliminary discussions with CDR cell to refer Suzlon for debt recast.

Tulsi Tanti-promoted Wind Energy company is reeling under high cost rupee debt of Rs 14,000 crore.  Its woes have increased after its bondholders rejected request to extend the time to redeem foreign currency convertible bonds (FCCBs) of $221 million (Rs 1,160 crore), due to mature this month.

SBI officials had said current default (on FCCB) is not very big if you consider the company’s total debt profile.

The company has got a very large order book. (Rs 15-,20,000 crore). The orders are continuously flowing in. This is a field where a lot of the investors are interested in. If the finances are set right, obviously they could attract other investors also, another SBI official said.

The company will have to negotiate with other bond holders and arrive at a settlement and this could impact the cash flows of the company.

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