Suzlon Scraps $1.2 Billion Debt Repayment Offer as Vestas Backs Out
The banks are yet to decide on the next steps to recover their dues, one of the source said.
(Bloomberg) -- Suzlon Energy Ltd. withdrew an offer to repay about 85 billion rupees ($1.2 billion) to lenders after Vestas Wind Systems A/C, which was backing the proposal, pulled out of the debt-resolution plan, according to people familiar with the matter.
The settlement was the only offer before the lenders led by State Bank of India after Brookfield Asset Management Inc. dropped out last month, the people said, asking not to be named as the information is not public. The banks are yet to decide on the next steps to recover their dues, one of the people said.
The Indian wind-turbine maker has been struggling since 2017 after Prime Minister Narendra Modi’s government shifted to auctions as the preferred method to install wind projects. That curtailed orders for the company amid rising operational costs and stiffer competition from global players.
Shares of Suzlon fell 7% to 3.30 rupees at 2:37 pm in Mumbai trading. The stock, which has plummeted about 40% this year, is set to close at the lowest level since listing.
A representative for SBI didn’t respond to an email and phone calls seeking comment while Suzlon’s spokeswoman declined to comment. Suzlon’s long-term bank facilities were downgraded to D from BB in April by Care Ratings Ltd. and the company missed payments on its dollar-denominated convertibles in July.
To contact the reporters on this story: Suvashree Ghosh in Mumbai at sghosh186@bloomberg.net;Baiju Kalesh in Mumbai at bkalesh@bloomberg.net;P R Sanjai in Mumbai at psanjai@bloomberg.net
To contact the editors responsible for this story: Marcus Wright at mwright115@bloomberg.net, ;Fion Li at fli59@bloomberg.net, ;Sam Nagarajan at samnagarajan@bloomberg.net, Anto Antony, Ravil Shirodkar
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