Mumbai: Promoters of construction firm Hindustan Construction Co. Ltd (HCC) have been unable to make full payment of an interest obligation due on a loan availed from special situations investor SSG Capital Management, according to filings with stock exchanges.
Arya Capital Management Pvt. Ltd, a promoter entity which holds 16.33% stake in HCC Ltd, on Monday said it was able to only partly pay an interest obligation due on a ₹270 crore loan. Arya Capital is the largest promoter shareholding entity in HCC. All of its shares are pledged with lenders, stock exchange data shows.
"Kindly take note that the interest due and payable on December 13, 2019 on the below mentioned non-convertible debentures has been paid but not fully due to insufficient funds," the promoter entity said.
The promoter company could not make an interest payment of ₹2.9 crore, the statement shows.
The said loan was raised by the promoter holding company in December 2018 to subscribe to the company's share in a ₹497.6 crore rights issue.
Of the ₹270 crore raised, ₹218.8 crore went towards subscribing to shares in the rights issue, while ₹32 crore was used to purchase more shares from the open market.
The debt, raised through non-convertible debentures, has a repayment duration of four and a half years, regulatory filings show, with an interest rate of 7% per annum. Arya Capital has pledged shares of HCC Ltd as security for the loan, apart from other assets provided as security.
The loan was raised from India Special Situations Scheme 1, a fund managed by Hong-Kong based investor SSG Capital Management.
HCC, the Ajit Gulabchand led EPC company, has been reeling under debt related stress for the past several years. In 2017, lenders decided to recast it's standalone debt under the Reserve Bank of India's S4A scheme.
Earlier this year, the company sold various arbitration claims to a consortium of investors led by Blackrock Inc, for a sum of ₹1,750 crore as part of its efforts to pare down debt.
Spokespersons for HCC and SSG Capital could not be immediately reached for a comment.