Mumbai (Maharashtra) [India], Apr 1 (ANI): In a major step towards resolving overall debt, IL&FS on Thursday announced the completion of its 49 per cent stake sale in its Chinese road asset Chongqing Yuhe Expressway Company (CYEC).
The stake is sold to China Merchants and Pingan Infrastructure Phase 1 Equity Investment Fund (Tianjin) Co Ltd, a fund jointly owned by Pingan Insurance and China Merchants.
This is the largest transaction for IL&FS since the sale of its wind energy assets to Orix. IL&FS has received Rs 1,035 crore in Singapore as part of this stake sale transaction.
The consideration will be used to pay 88 million dollars (about Rs 639 crore) of Bank of Baroda loans and the balance to meet IIPL liabilities including bondholders under IOPL.
IL&FS Group held 49 per cent stake in CYEC through its step-down Singapore-based subsidiary ITNL International Pte Ltd (IIPL).
The balance 51 per cent stake in CYEC is held by Chongqing Expressway Group (CEG). Pingan had bid at an aggregate equity valuation of 281 million dollar for 100 per cent stake.
This values IIPL's 49 per cent stake at 140 million dollars and Pingan had agreed to take over the Rs 1,600 crore debt in CYEC (as of December 2018).
The transaction was completed post receipt of approval from retired Supreme Court Justice D K Jain and NCLT ITNL Offshore PTE Ltd and ITNL International Pte Ltd (IIPL) are two Singapore based subsidiaries of IL&FS Transportation Networks Ltd (ITNL), a majority-owned subsidiary of IL&FS.
CYEC holds and operates a concession for a toll-based expressway of 58.72 km in China mainland till 2032. The company has the right to collect toll from users and concessions from the Chinese government for the remaining period of the concession term.