IL&FS Solar Power (ISPL), a part of the troubled IL&FS Group, said on Thursday that it has paid its entire debt of around Rs 845 crore across all its creditors as a part of the resolution process.
The cash-strapped IL&FS Group has been trying to sell assets for debt resolution and had publicly solicited bids for ISPL in November 2018, which did not elicit any bids. IL&FS said that the repayment of debt will be a key intermediate step in the resolution of ISPL.
ISPL had built and financed a 100 megawatts (mw) solar power project in Karnataka for Embassy Energy Private (EEPL), which was commissioned in February 2018. For the projects, ISPL had raised secured and unsecured loans and it received equated monthly installments from EEPL as per a deferred payment agreement between the two companies.
IL&FS said that EEPL, in exercise of its rights under DPA, has pre-paid the financial assistance extended by ISPL towards the project that was payable by February 2033. This helped ISPL to repay its debt.
Chairman of the crisis-hit IL&FS, Uday Kotak had chalked out an ambitious plan to recover over 50% of its debt, amounting to Rs 47,000 crore, by March 2020. But the lockdown due to the Covid-19 pandemic derailed the plans. The group had Rs 94,000 crore at the time it defaulted on several loan obligations in September 2018, which triggered a fraud investigation.
