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The new board of the troubled Infrastructure Leasing and Financial Services (IL&FS) headed by well known banker Uday Kotak and formed to address its 910-billion rupee (US$12.9 billion) debt crisis, has said that a single solution is not possible. To achieve such a group resolution would require significant capital infusion from credible and financially strong investors. The board deemed this not to be feasible.
Instead the board calls for exploring other options such as hiving off and selling entire business verticals to willing buyers, reports Mint newspaper.
If that were to fail then the option of asset-level resolution should be explored through various methods, including capital infusion and asset monetisation to retire debt and reach compromises with creditors.
Incorporated in 1987, IL&FS has played a major role in Indian infrastructure development and financing. Its 169 group companies include subsidiaries, joint-venture companies and associate entities.
It recently defaulted on some of its debt obligations, triggering concerns that it might lead to the collapse of the country’s financial system and markets.
Meanwhile, the NCLT on Monday passed an interim order to attach all movable or immovable properties of nine former directors of IL&FS. The court also directed them to disclose their securities and bank accounts within the country and overseas. Earlier the Corporate Affairs Ministry had approached the NCLT seeking action against the former directors.