Suzlon said it will repay domestic term loans worth Rs 5000 crore with the proceeds from the sale of its German arm Senvion
The News International Team
Wind turbine maker Suzlon has sold its German arm Senvion to US-based private equity firm Centerbridge Partners for 1 billion euro in an all cash deal.
Suzlon said it expects the deal to be completed by the end of March.
The deal will help Suzlon reduce Rs 5000 crore of debt on its balance sheet.
The company said it will repay domestic term loans worth Rs 5000 crore with the proceeds from the sale.
Suzlon said it will use Senvion’s offshore technology by paying a license fee.
“The proceeds would be used for debt repayment thereby reducing interest cost and augment business growth,” Tulsi Tanti, Chairman, Suzlon Group said in the media release.
“We will focus on high growth markets like India, USA and other emerging economy markets. With our market leadership, right technology, proven project execution capabilities and best in class services, we are best positioned to tap the high growth potential in home market,” he said.
According to data collated by CNBC-TV18, State Bank of India and IDBI Bank are the biggest lenders to Suzlon. SBI’s exposure is around Rs 3500-3600 crore, while that of IDBI Bank is around Rs 2000 crore.
Bank of Baroda, Indian Overseas Bank and Punjab National Bank together have an exposure of around Rs 2800 crore.
Suzlon had restructured loans worth Rs 9500 crore in October 2012. The recast involved a back ended repayment plan at a reduced interest rate, and a 2-year moratorium on principal and term debt interest payment.
Among private lenders Axis Bank has an exposure of around Rs 400 crore, ICICI Bank has an exposure of around Rs 350-380 crore and Yes Bank has loaned around Rs 200 crore.
Suzlon Energy stock price
On January 22, 2015, at 09:35 hrs Suzlon Energy was quoting at Rs 17.38, up Rs 0.19, or 1.11 percent. The 52-week high of the share was Rs 36.80 and the 52-week low was Rs 9.36.
The latest book value of the company is Rs 8.63 per share. At current value, the price-to-book value of the company was 2.01.