IL&FS begins interim distribution payment
Bombay: IL&FS has commenced interim distribution payment with Rapid Metro Gurgaon Rail Ltd (RMGL), an IL&FS group company.
The group has completed the distribution of Rs 623.38 crore, on an interim basis, to secured lenders/secured financial creditors of RMGL comprising Union Bank of India, Bank of India, Indian Bank, Punjab & Sind Bank, UCO Bank, Bank of Baroda, National Bank of Punjab and Overseas Indian Bank.
The total claims from these lenders was Rs 715 crore.
This provisional distribution therefore translates into a recovery of approximately 83% for these creditors. The disbursement of additional amounts to unsecured financial creditors and unsecured creditors is also in progress.
The IL&FS board of directors had approved this interim distribution at its board meeting held on November 2. This is the first payment by IL&FS under the interim distribution in which it is proposed to distribute a total amount of Rs 16,361 crore to certain group companies.
The proposed distribution of Rs 16,361 crore which would include Rs 11,296 crore silver and Rs 5,065 crore Invit unit is being undertaken in accordance with the draft distribution framework approved by NCLAT in June this year.
The Board announced that a significant portion (Rs 55,000 crore) of the overall resolution (of Rs 61,000 crore) would be completed by this year (subject to approvals).
However, the final resolution of the remaining entities of the IL&FS group (resolution value Rs 6,000 crore) is likely to take a long time due to the complexity of the process.
Therefore, interim distribution has been proposed to facilitate payment to all classes of creditors (in accordance with the NCLAT-approved process) on the condition that any excess payment in the interim stage shall be returned to the group no later than final distribution stage.