Essel Group Pays Rs 4,450 Crore To Mutual Funds, Other Lenders
Essel Group repays lenders over a third of the amount due by September-end deadline.
Subhash Chandra-led Essel Group paid lenders over a third of the amount due by September-end in the first tranche, according to a person aware of the development.
The Zee group promoters, which sold a stake in flagship Zee Entertainment Ltd. a month ago, repaid nearly Rs 4,450 crore to lenders including mutual funds and non-bank finance companies, the person said on the condition of anonymity as the information is not public yet.
Mutual funds will get close to Rs 4,000 crore with Birla Mutual Fund, with the largest exposure, getting around Rs 750 crore in the first tranche, the person said.
Essel Group has yet to respond to a BloombergQuint query.
The debt-ridden group has to pay additional Rs 7,000 crore by the end of the month when a standstill on sale of Zee Entertainment Enterprises Ltd. and other group companies’ shares ends. These were offered as a collateral against borrowing through non-convertible debentures. Lenders, mostly mutual funds, had agreed to give time after the stocks tumbled as much as 37 percent in a single day on worries around promoter debt, increasing the risk of default.
Mutual funds have a total exposure of more than Rs 17,000 crore to three Essel Group promoter entities, according to data by fund houses and credit rating agencies.
As part of its plan to pare debt, Essel Group sold 11 percent stake in its flagship Zee Entertainment to Invesco Oppenheimer Developing Markets Fund for Rs 4,224 crore.
Last month, the promoters of India’s largest broadcaster also agreed to sell 205-megawatt of solar farms to billionaire Gautam Adani’s conglomerate at an enterprise value of Rs 1,300 crore to repay lenders. It is also working towards closing the sale of its six road assets in addition to remaining solar power portfolio of 480 MW.
The promoters are likely to sell additional stake in Zee Entertainment by the end of the month in case its non-media asset sales don’t fructify, Punit Goenka, managing director and chief executive officer of Zee Entertainment, had told BloombergQuint after the Invesco deal.