Jaiprakash Associates defaults on interest payment on NCDs

Jaiprakash Associates says the interest payment default was in respect of 12.40% non-convertible debentures (NCDs) for more than three months as of 4 May


Jaypee Group executive chairman Manoj Gaur. Jaiprakash Associates is the flagship firm of the Jaypee Group. Photo: Pradeep Gaur/Mint
Jaypee Group executive chairman Manoj Gaur. Jaiprakash Associates is the flagship firm of the Jaypee Group. Photo: Pradeep Gaur/Mint

Mumbai: Debt-laden infrastructure firm Jaiprakash Associates Ltd on Thursday said it has defaulted on interest payments in respect of 12.40% non-convertible debentures (NCDs) for more than three months as of 4 May.

In a BSE filing on 26 April, Jaiprakash Associates said that its principal and interest due in respect of 11.75% NCDs and interest due in respect of 12% NCDs remained unpaid for more than three months.

Jaiprakash Associates is the flagship firm of the Jaypee Group.

“This may be read in consonance with disclosures/ press releases...wherein the company has informed about the disinvestment initiatives being undertaken/ pursued to deleverage its balance sheet and improve its cash flows for timely servicing of its debt obligations,” the firm said in a filing on Thursday.

In February 2016, Jaiprakash Associates had announced an agreement for sale of its 18.4 million tonne cement assets to UltraTech Cement Ltd for about Rs16,500 crore. As part of the deal, UltraTech will also pay an additional Rs470 crore on completion of the under implementation cement grinding capacity of 4 million tonne. The deal is expected to receive all approvals including transfer of mining rights in the next two-six weeks, according to UltraTech Cement.

In July 2016, the company said its Joint Lenders Forum (JLF) meeting had agreed for invocation of Strategic Debt Restructuring (SDR), subject to approval of lenders.

In October 2016, the company had approved the sale of Nigrie Cement Grinding Unit to Orient Cement Ltd based on an enterprise value of Rs500 crore.

A year earlier, the company had missed interest payment on its bonds worth $150 million.

As on 31 December, Jaiprakash Associates had standalone debt of Rs20,735.97 crore. The Jaypee Group has an estimated debt of Rs75,000 crore as of 31 March 2015, according to a Credit Suisse House of Debt report dated 21 October 2015. Lenders to the group have been pushing for asset sale to reduce debt and lenders to group company Jaiprakash Power Ventures Ltd invoked SDR in February.

On Thursday, the company’s shares closed down 0.31% to Rs13.02 a share on BSE while the bench mark index Sensex ended the day 0.77% higher at 30,126.21 points.

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