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Suzlon facing default as Vestas' offer expires - report

Suzlon turbines. Author: Janusz Sobolewski. License: Creative Commons, Attribution 2.0 Generic.

June 11 (Renewables Now) - Indian wind turbine maker Suzlon Energy Ltd (BOM:532667) has no alternative plan on how to repay certain foreign currency convertible bonds (FCCBs) and so it is facing a INR-12.05-billion (USD 174m/EUR 153m) default next month, The Times of India reports.

Debt-laden Suzlon was expected to deal with its financial obligations by welcoming a new investor. However, that opportunity may have vanished.

CNBC-TV18 reported in February that Danish peer Vestas Wind Systems A/S (CPH:VWS) was holding discussions to buy a controlling stake in Suzlon. The news channel said on Monday that Vestas’ offer had expired on June 3 without resulting in a deal because of a valuation difference.

The Times of India said an extension clause had been agreed with the potential investor.

The Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) have sought clarification from Suzlon with reference to the report and are awaiting a reply from the company.

At the end of May, Suzlon posted a net loss of INR 15.37 billion for the fiscal year through March 2019, compared to a loss of INR 3.84 billion a year earlier. Its consolidated net term debt amounted to INR 77.61 billion and working capital debt was INR 33.8 billion.

(INR 10 = USD 0.144/EUR 0.127)

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Ivan is the mergers and acquisitions expert in Renewables Now with a passion for big deals and ambitious capacity plans.

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