Air India lenders clear Rs.18,000-cr debt recast

Mumbai: Lenders of cash-strapped Air India on Friday approved its corporate debt restructuring plan worth Rs.18,000 crore and decided to provide a fresh cash credit of Rs.2,200 crore.
Of the Rs.18,000-crore debt restructuring plan, Rs.7,400 crore worth of non-convertible debentures, guaranteed by the government, would be issued, banking sources said here.
They said the 13-bank consortium, led by State Bank of India, had also agreed to give Rs.2,200-crore worth of fresh working capital loan to the ailing national carrier.
The approval by the banks came ten days after a Group of Ministers, headed by Finance Minister Pranab Mukherjee, decided to allow Air India to raise Rs.7,400 crore by issuing sovereign guaranteed non-convertible debentures.
The debentures were likely to carry a coupon rate of 8.5-9 per cent and financial institutions might subscribe to these bonds, official sources said. This would be part of the national carrier's financial restructuring plan that was approved by the GoM on February 7.
However, the bonds issue would have to be cleared by the Union Cabinet, they said.
17/02/12 The Hindu

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Categories: Air India Feb 2012