IL&FS hands over education arm to Lexington Equity in slump sale1 min read . Updated: 02 Sep 2020, 10:53 PM IST
After this deal, LEHL will service Schoolnet’s entire debt of ₹600 crore and pay a small equity to IL&FS to the tune of ₹7.36 crore and deferred purchase consideration of ₹6.29 crore
The Mumbai bench of the National Company Law Tribunal (NCLT) has approved the sale of Infrastructure Leasing and Financial Services' (IL&FS) education assets to its minority partner Lexington Equity Holdings Ltd (LEHL) on a slump sale basis.
LEHL’s subsidiary Falafal Technology Private Limited will acquire the 73.87% of Schoolnet India Ltd which is currently owned by IL&FS, IL&FS Employee Welfare Trust and other individuals. LEHL, part of India Equity Partners, currently owns 26.13% of Schoolnet India.
After this deal, LEHL will service Schoolnet’s entire debt of ₹600 crore and pay a small equity to IL&FS to the tune of ₹7.36 crore and deferred purchase consideration of ₹6.29 crore. LEHL has also agreed to give an upside amount to IL&FS, subject to it realising an amount in excess of ₹171.62 crore from the sale of 100 per cent of the equity shares of Schoolnet.
Schoolnet India’s assets Skill Training Assessment Management Partners Ltd (STAMP) and IL&FS Cluster Development Initiative Limited (ICDI), which are wholly-owned subsidiaries. Schoolnet also has a joint venture with the National Skill Development Corporation called IL&FS Skill Development Corporation Ltd, in Schoolnet holds 80% stake.
LEHL offered to take over the majority stake in Schoolnet after it was unhappy with the terms of purchase offered by prospective buyer Career Point.
As of July, the Uday Kotak-led board of directors of IL&FS has resolved 18% of the company’s outstanding debt of more than ₹1 lakh crore, nearly two years after taking control of the bankrupt shadow banker and construction firm. The board said that legal and regulatory delays and Covid-19 has slowed down resolution process. The board set a new resolution timeline and said it will be able to resolve ₹50,590 crore of outstanding debt by March 2021 and a further ₹6,650 crore in FY22.
The bankrupt lending company has been selling its joint venture assets to equity partners to resolve unpaid debt. It sold its 50% stake in Gujarat International Finance Tec-City Co. Ltd (GIFT City) to the Gujarat government and its 51% stake in its wind energy portfolio to its Japanese partner ORIX Corporation.