Mumbai: IL&FS group chairman Uday Kotak on Thursday hinted that the crisis at the infra lending and engineering conglomerate is much more complex than earlier thought as the number of its subsidiaries and associates have more than doubled to 348,most of which have negative net worth.
In a Satyam Computers-style takeover, government on Monday had superseded the board of IL&FS and appointed a six-member board with Kotak as the non-executive chairman. The board had a marathon five-hour maiden meeting here and Kotak briefed the media in the evening.
“The board was informed that there are 348 entities as part of the group, which is significantly larger than what we were told earlier. This is a very significant aspect of any resolution. “We undertook an initial assessment of the ground reality and the way forward. We’ll meet frequently to implement the directions of NCLT and to prepare a roadmap and turnaround,” Kotak said. It can be noted that the company was earlier claiming that it has around 150 subsidiaries including around 50 overseas. Its auditors have tagged most of them as non-going concerns due to their negative net worth for long–something it has not disclosed publicly.
When asked whether the debt obligation will be higher as number of entities has more than doubled, Kotak said, “the earlier obligations were as of March 2018. Obviously, this is a moving target. We are looking at all the obligations and financing which the company raised.”
The company as of March 2018 owed over Rs 91,000 crore to a banks and other creditors and since August 27, it has been on defaulting spree with nearly a score cases being reported so far.”Obviously, we’ve a challenge. After today’s meeting, we have a sense of broadly in what direction we need to go forward and have a better sense of alternatives that we can explore,” Kotak said.
The board meeting also decided to preserve value of the company and its subsidiaries, joint ventures and associates, and that the board will take all necessary steps to achieve that, he said, adding they were briefed in detail by the legal advisors on the current issues.
Vineet Nayyar named as MD
New Delhi: IL&FS has appointed Vineet Nayyar as its managing director, the company’s new Non-Executive Chairman Uday Kotak said. The new board will meet frequently and take all necessary steps to revive the company, said Kotak, who is also the MD of Kotak Mahindra Bank. Nayyar is the executive vice chairman of Tech Mahindra, which helped revive failed computer services company Satyam, also following government intervention. The Mahindra group acquired Satyam in 2009. The board also said the board will meet regularly to draft roadmap for the future for the systematically important entity, whose control government wrested in a Satyam Computers-style takeover this Monday.
