Lenders allow Biyani’s Future Retail to pay interest on foreign bonds
Future Retail Ltd (FRL) lenders controlled by Kishore-Biyani have authorized the company to make interest payments of more than 100 crore rupees (about $14 million) on the foreign currency denominated bonds. He already missed the refund due last month and the 30-year grace period ends early next week.
The company had approached the banks to authorize the payment of interest. Lenders looked at cash flow and decided to give the green signal. It pays interest to domestic lenders. However, this is a default in principle, said a senior bank executive.
For many restructured loan accounts like FRL, the banks monitor the movement of funds and there is an ongoing assessment of the financial condition. The decision was made keeping in mind the flow of funds and the need to avoid further complications for resolution efforts, another bank official said.
On February 02, rating agency Standard and Poor’s (S&P) confirmed Future Retails’ dollar-denominated bond rating at ‘CCC-‘, saying it expects the company to service the coupon half-yearly within a 30-day grace period, consistent with the past. tendencies. Coupon was due on tickets on January 24, 2022.
A repayment of approximately Rs 3,500 crore was due on December 31, 2021 on the bank loans under a one-time restructuring plan implemented by onshore lenders in April 2021. The company was granted a grace period. 30-day review to remedy the defect. .
Future Retail failed to correct the default amid an unsuccessful attempt to monetize its small-format stores and insufficient cash flow to meet the large repayment obligation.
Future Retail also said in an exchange filing that it made interest payments for the six months ended in the amount of $14 million on dollar-denominated notes.