Debt-ridden Hotel Leelaventure will renegotiate with possible lenders for a bridge loan as the terms for borrowing did not meet its requirements.
The hospitality chain that runs hotels and resorts under the Leela brand, in its board meeting held today authorised its Chairman & Managing Director Vivek Nair "to negotiate and finalise the terms and conditions of the bridge loan for meeting the debt service obligations of the Company".
"... The Company at its meeting held on March 12, 2014, considered the progress on the sale of assets and indicative term sheets for a bridge loan and resolved that the terms of the loan do not meet the Company's requirements," the company said in a filing to BSE.
The firm which has reportedly over Rs 4,500 crore debt had stated earlier this week it has been in talks with various investors and lenders, for raising funds to meet debt servicing obligations but has not entered into any agreement with any of them.
Globally buyout firm Kohlberg Kravis Roberts & Co has been linked for a possible Rs 2,000 crore loan to the hospitality firm against its two prime properties.
Hotel Leelaventure had registered a loss of Rs 100.59 crore in the third quarter of this financial year ended on December 31, 2013. In this financial year, the company has made a loss of Rs 384.33 crore.
On February 13, Hotel Leelaventure had said that if the sale of assets as envisaged in the CDR package does not take place, the company will have to apply for revision in the package.
In 2011, the company had sold luxury hotel property in Kovalam, Kerala to Travancore Enterprises Pvt Ltd (TEPL) for Rs 500 crore, in an effort to reduce its debt.
It had also sold its IT park building in Chennai to Reliance Industries Limited (RIL) for Rs 170.17 crore in 2011.
