IL&FS Seeks NCLT Approval To Complete Sale Of Its Wind Energy Unit To Japanese Company Which Owns Major Stake

Infrastructure Leasing and Financial Services (IL&FS) has filed a proposal to the National Company law Tribunal (NCLT) to complete the sale of its unit called IL&FS Wind Energy Ltd (IWEL) to Orix Corporation of Japan.

According to the debt-ridden lending firm, the sale of its unit to Orix would lead to the debt resolution of the following seven companies of the IL&FS Group -- Lalpur Wind Energy Private Ltd, Etesian Urja, Khandke Wind Energy, Retadi Wind Power, Wind Urja India, Tadas Wind Energy and Kaze Energy.

Incidentally, IL&FS had already received approval earlier for the sale of its wind energy business from Justice (Retired) D K Jain, who was appointed by the National Company Law Appellate Tribunal (NCLAT) to supervise the operation of the debt resolution process of the IL&FS group companies.

According to a recent IL&FS statement, the proposal has been filed before the NCLT after completing a binding share purchase agreement with Orix Corporation and obtaining 'in-principle' approval from all lenders for completing the transaction, subject to NCLT approval.

The sale was approved on the condition that the proposal will be placed before the NCLT for its approval and the bid amount realised from the sale be kept in an escrow account.

The other condition was that this amount in escrow account would be disbursed only in accordance with directions of the proceedings.

Incidentally, Orix already owns a 49% stake in each of the IL&FS group's seven operating wind power plants, had expressed its intent to buy out the remaining 51% stake held by IWEL.

This was based on the terms of an existing agreement wherein Orix can match the price offered by the highest bidder to purchase IWEL's stake in diverse special purpose vehicles (SPV).