Unitech, the nation’s second-biggest real estate developer, said it has managed to slash debt repayment obligation for the current financial year to a fourth of the original through a combination of repayments and rollovers. The developer also got shareholder approval to raise Rs 5,000 crore from sale of securities.
The New Delhi-based developer, which needed to repay Rs 2,500 crore of debt by March 31, has repaid Rs 400 crore owed to the mutual funds and managed to roll over another Rs 500 crore. The company needed to repay Rs 900 crore of debt to mutual funds today.
The company had earlier restructured Rs 1,000 crore worth of debt owed to banks and is in negotiations to restructure another Rs 500 crore.
The company now has only 25 per cent of its original obligation to be repaid in the current financial year, Sanjay Chandra, managing director, Unitech said. The debt rolled over by the mutual fund industry will not be due in the current financial year, he said.
Unitech is also in talks with lenders to convert Rs 2,500 crore of short term debt, commercial papers and loans, into long-term debt.
The reduction of the debt repayment obligation comes even as Unitech shareholders today approved the company’s plan to raise Rs 5,000 crore through sale of securities. The approval came at the extraordinary general meeting held today.
The company is in talks with a few private equity investors to raise funds. ''We have received a few expressions of interest,’’ Chandra said declining to give more details. The dilution in equity will be much less if private equity or strategic investors agree to invest to convertible debentures.
The Unitech EGM today also approved the company’s move to double the share capital of the company to Rs 1,000 crore.
Meanwhile, Unitech expects the first transaction of Rs 1,200 crore as payment from Telenor to be completed by January 31. Of the expected Rs 1,200 crore, to be infused into Unitech Wireless, the real estate developer is expected to receive Rs 350 crore as it has loaned about Rs 800 crore to the telecom unit.
Unitech will still have Rs 450 crore debt outstanding to its wireless unit which will continue to earn interest at one per cent above the State Bank of India prime lending rate, sources said.
Unitech shares rose Rs 1.80 or 6 per cent, to Rs 31.90 at the close of trading on BSE today.
