GTL Infra ropes in Bajpai, Chakrabarty as advisors
GTL Infrastructure has included former Reserve Bank of India (RBI) deputy governor K C Chakrabarty, former Securities and Exchange Board of India chairman G N Bajpai and chartered accountant Shailesh Haribhakti to the committee that monitors the implementation of its strategic debt restructuring (SDR).
The company believes the trio’s advice will ensure transparency during the SDR process, the merger of Chennai Network Infrastructure (CNIL) into the company, the investor induction process and discovery of true value.
The committee is headed by former Small Industrial Development Bank of India chairman N Balasubramanian and has management expert Anand Patkar and solicitor Vinod Agarwala as members.
Manoj Tirodkar, chairman of GTL Infra, told Business Standard, “The appointment of these eminent personalities is to ensure that the lenders of the tower company have 100 per cent recovery of debt and equity conversions with full value of loan and equity being recovered over the next 18 months. This process requires maximum transparency between the prospective new investor and the company. Hence, lenders and the independent committee must play a vital role to devise maximum value which will derive maximum benefit to minority investors and lenders.”
The SDR scheme, which was recommended by the board on September 19, involves conversion of ~3,700 crore of the total debt of ~8,600 crore into equity at par value in accordance with RBI guidelines and also the merger of CNIL into GTL Infra.
Company sources said this would give lenders a combined 51 per cent in the merged entity. This apart, bond holders are likely to convert ~1,200 crore of debt into equity and promoters have agreed to cancel crossholdings of ~1,800 crore held by GTL.
GTL had, in 2011, undergone the restructuring programme with CNIL and paid the CDR lenders ~3,391.6 crore. The company had also paid ~115.8 crore for the foreign currency convertible bond holders and repaid debt of ~6,000 crore at group level to its lenders without any incremental borrowings.
However, the company noted that its financial performance was adversely impacted due to external developments leading to a revenue shortfall of ~1,177.7 crore. This led to a cashflow shortfall.
Tirodkar said the company and the committee of independent directors suggested an adoption of an open and transparent bidding process.