Debt-ridden IL&FS scraps dividend to its shareholders ahead of AGM

IL&FS now plans to raise equity capital of Rs 45 billion

While raising funds from investors in August, beleaguered financial institution Infrastructure Leasing & Financial Services (IL&FS) painted a bullish picture of its operations and did not give any indication that within few weeks of the issue closing, it will start defaulting on its debt repayments.

In its private placement prospectus of August 21, IL&FS announced that it will pay a dividend of Rs 6 a share to its equity shareholders and is current on all of its debt obligations. IL&FS raised Rs 500 million from its debt investors with a greenshoe option of Rs 250 million.

The issue closed on August 27,