Ltd (WIL), engaged in engineering, procurement and construction () business, has initiated talks with banks and finance companies to replace high-cost debt raised from private equity player KKR, said two persons with knowledge of the matter.
Between July and October this year, a KKR managed fund and its finance company acquired 24.9% equity stake of Walchandnagar Industries by invoking shares pledged by promoter and promoter group companies after the oldest business house missed payments on debt facilities totalling to ₹25.9 crore, according to the disclosures made by the company to the stock exchange.
The default to KKR was on account of a delay in receiving payments of $4.2mn from Tendaho Phase I Project in Ethiopia, one of the persons cited above said.
The private equity player has refrained from invoking 25% or more stake as it would trigger an open offer as per the guidelines by the market regulator, a third person said.
Between mid-October and mid-November, KKR has sold 3.77% stake it held in WIL in the open market, according to a stock exchange notice.
"The constraint in extending debt facilities to such companies that have the government as a client is a risk of not receiving timely payments despite timely execution of the project. It's a B2G (business with government) risk which is difficult to mitigate," said one of the private credit providers approached by the company for refinancing of debt facilities. "As a result of non-payment, it is difficult to scale up the business," he added.
Between July and October this year, a KKR managed fund and its finance company acquired 24.9% equity stake of Walchandnagar Industries by invoking shares pledged by promoter and promoter group companies after the oldest business house missed payments on debt facilities totalling to ₹25.9 crore, according to the disclosures made by the company to the stock exchange.
The default to KKR was on account of a delay in receiving payments of $4.2mn from Tendaho Phase I Project in Ethiopia, one of the persons cited above said.
The private equity player has refrained from invoking 25% or more stake as it would trigger an open offer as per the guidelines by the market regulator, a third person said.
Between mid-October and mid-November, KKR has sold 3.77% stake it held in WIL in the open market, according to a stock exchange notice.
"The constraint in extending debt facilities to such companies that have the government as a client is a risk of not receiving timely payments despite timely execution of the project. It's a B2G (business with government) risk which is difficult to mitigate," said one of the private credit providers approached by the company for refinancing of debt facilities. "As a result of non-payment, it is difficult to scale up the business," he added.
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