IL&FS Group will publicly solicit expressions of interest for selling controlling stake in its renewable energy assets and businesses. (Photographer: Alessia Pierdomenico/Bloomberg)

IL&FS Puts Renewable Energy Assets On The Block

Debt-laden Infrastructure Leasing & Financial Services Ltd. has decided to gauge investor interest for its renewable energy assets after it received a strong response from buyers for two securities clearing services subsidiaries.

The government-appointed board, led by veteran banker Uday Kotak, will solicit expressions of interest for selling controlling stake in renewable energy assets and businesses held by the IL&FS Group, which include:

  • Operational wind power generating plants with total capacity of 873.5 megawatts.
  • Under-construction wind power plants of 104 megawatts capacity.
  • Asset management services for the operational wind energy plants, as well as the business division conducting project development of wind power plants.
  • Businesses for project development and implementation of solar power generating plants and under-construction projects of about 300 megawatts capacity.

The second leg of asset monetisation may be carried out for individual assets or as a basket, or a combination of both, the company said in a press statement. The move will help the group “ascertain investor interest and examine feasibility of maximization of value in an orderly and transparent manner”.

IL&FS said it received over a dozen offers after it on Nov. 12 invited expressions of interest for stake sale in two companies— IL&FS Securities Services and ISSL Settlement & Transaction Services. That came after a buyout deal with IndusInd Bank for one of its securities firms fell through over fears of the ongoing financial crisis at the group.

The stake sales are part of the new board’s revival plan approved by the insolvency court on Oct. 31. The government took control of the troubled infrastructure group after multiple defaults to prevent a contagion in India’s financial markets. IL&FS and its 347 subsidiaries and associate companies have a debt of about Rs 91,000 crore.

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The final transaction for sale of assets, and the resulting resolution plan can be implemented only after it gets approved by the National Company Law Tribunal. The IL&FS asset sale will be managed by Arpwood Capital and JM Financial—appointed as financial and transaction advisers—along with Alvarez & Marsal, the resolution consultant.

The statement said that the stake sale would help the board in developing a turnaround plan for the group, which would be done through asset divestment or a combination of revival plans submitted to the NCLT.

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