RInfra lenders sign inter-creditor agreement on resolution plan

The Anil Ambani-led Reliance Infrastructure Ltd’s 16 lenders have signed an inter-creditor agreement (ICA) in an effort to resolve its debt. An ICA provides the ground rules for the finalisation and implementation of a resolution plan (RP) for borrowers with credit facilities from more than one lender.

RInfra’s lenders have all signed up to resolve its debt, which is estimated at ₹5,900 crore. The development comes on the back of a June 7 RBI circular on “Prudential Framework for Resolution of Stressed Assets.” Under the framework, an RP has to be agreed to by 75 per cent of the lenders by value of debt and 60 per cent by number of lenders.

With the ICA, RInfra has achieved a 180-day standstill period. The purpose of the standstill period is to give the senior creditor an exclusive period of time during which it may assess its rights and, if it determines that it will enforce its rights against the collateral, to enforce such rights without interference from the junior creditors.