Lanco looks to mop up $1 billion

Highlights

Lanco Infratech Ltd is gearing up to mop as much as $1 billion (about Rs 6,635 crore) over the next year and a half through listing of its power assets and stake sale. The infrastructure major will use the funds to reduce its debt burden.

Hyderabad: Lanco Infratech Ltd is gearing up to mop as much as $1 billion (about Rs 6,635 crore) over the next year and a half through listing of its power assets and stake sale. The infrastructure major will use the funds to reduce its debt burden.

This development assumes significance in the wake of the company returning to profits during the second quarter ended in September. Lanco which is weighed down by a total debt of over Rs 35,000 crore has been registering losses in the last few years.

"It could be a strategic investor for a stake sale. We would also like to list Lanco power assets," T Adi Babu, Chief Financial Officer, Lanco, said. He further said that company was hoping to raise between $750 million and $1 billion from these measures. In addition, it is looking to sell one large power project in 2017 once all its plants are fully operational.

"We want to sell one big asset to bring down debt and improve liquidity. There's a good prospect we can sell at least one asset," he added. Lanco has been working with its bankers to restructure its debts, and Adi Babu said its lenders had started releasing funds to help it restart work at stalled plants.

The company now operates 4,000 megawatts (MW) of power assets and expects to complete another 4,000 MW in around two years, which will involve its debt rising to 450 billion rupees before it starts falling. (With agency inputs)

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