Troubled real estate sector-focused NBFC, Altico Capital, on Wednesday presented a draft resolution proposal to its lenders, multiple sources aware of the development told CNBC-TV18.
During the meeting held yesterday, which was attended by the top management of Altico Capital and the core committee of lenders, the company proposed to repay the lenders the entire dues of more than Rs 4,300 crore over a span of five years, the sources, who did not want to be named, told CNBC-TV18.
Altico Capital has proposed to securitise a pool of about Rs 1,500 crore of assets, which forms almost 20 percent of its book, upfront to generate cash to repay lenders, said a person who was present at Wednesday's meeting.
Further, Altico told the lenders present in the meeting that it has received term sheets from three prospective players for the sale of its assets, including global private equity players and asset reconstruction companies, the person quoted above said.
Altico Capital also informed the lenders that it is currently receiving collections of about Rs 100 crore a month, and has cash of over Rs 300 crore on its books.
Altico Capital defaulted on Rs 20 crore ECB repayment to Mashreq Bank earlier, which led to a few lenders recalling loans. Thereafter, the leaders formed a committee to execute a resolution plan for the NBFC under the RBI's June 7 circular by singing an Inter-Creditor Agreement. Altico Capital owes over Rs 4,300 crore to 27 lenders led by IFC, Yes Bank, State Bank of India, Bank of Baroda, UTI MF and Reliance MF among others.
During the meeting, Altico informed lenders that it would start repaying them within the first quarter of the resolution plan being firmed and signed, said the sources. The management of Altico asked lenders to consider its proposal as it takes into consideration the going concern perspective on returns as against viewing it as a stressed asset involving haircuts, said one of the sources.
A spokesperson of Altico Capital told CNBC-TV18 earlier that the firm has an underlying collateral value of approx. Rs 11,000 crore against the total Rs 7,000 crore lent. Of the Rs 7,000 crore lent, Rs 3,000 crore is equity while the remaining Rs 4,000 crore is debt, indicating low levels of leverage.
CNBC-TV18 learns that the company estimates that nearly 20 percent of the book (roughly Rs 1,500 crore) is exposed to highly valued assets that would attract good investor interest, and another 60 percent of the book (roughly Rs 4,000 crore) is exposed to players in construction finance that require support in the form of continued disbursements to complete projects. The remaining 20 percent of the book, as per the official, is exposed to more troubled players that would require more structured solutions.
The proposal presented by Altico Capital is at a draft stage and would have to be independently verified and studied by the lenders before any agreement can be reached, explained a bank official with exposure to the NBFC.
Altico Capital did not comment on CNBC-TV18's query regarding this story.