From roads to radio units, Anil Ambani group mulls $3.2-bn distress sale

International News

Indian tycoon Anil Ambani plans to raise about Rs 217 billion ($3.2 billion) by selling assets from roads to radio stations in a bid to cut debt.
The breakdown is like this, according to the group spokesman:
Reliance Infrastructure Ltd. is seeking Rs 90 billion from the sale of nine road projects.
Reliance Capital Ltd. aims to raise Rs 12 billion by selling its radio unit, and Rs 115 billion from monetizing its holdings in the financial business.
Ambani is waging a war on debt. He said on June 11 that his Reliance Group repaid Rs 350 billion in the past 14 months through asset disposals.
But a large pile remains. The four biggest group companies still have about Rs 939 billion of debt. And that excludes Reliance Communications Ltd., Ambani’s former flagship firm, that recently slipped into insolvency.
Further asset sales would help Ambani bolster the financial health of his group’s companies after a string of setbacks that included an auditor resigning at one of the firms and plunging stock prices at others. Rating cuts have also flagged credit market concerns.
Quick closure

 Quick closure of the planned asset sales is key. CARE Ratings had pointed to delays in divestments at Reliance Capital in an April statement while cutting the financier’s rating.Reliance Communications’ 2017 deal to sell its telecom assets to Reliance Jio Infocomm Ltd., owned by Anil’s elder brother Mukesh Ambani, was scrapped earlier this year...Read More

Anil Ambani-promoted RInfra loses NTPC order worth Rs 567 crore to GE

Company News

While Anil Ambani-promoted Reliance Infrastructure looks to almost double its existing order-book in the current financial year, not all is well with its existing orders. One of RInfra's contracts worth Rs 567 crore from NTPC has been re-tendered and awarded to another company this month.
In February 2018, RInfra informed exchanges it has received the Letter of Approval from NTPC for Flue Gas Desulphurisation (FGD) works of its 3x500 Mw power plant in Jhajjar, Haryana. “The project has been re-tendered and awarded to GE,” said a person with knowledge of the development. The reason for re-tendering is not clear. An email query sent to RInfra last week remained unanswered.
On June 4, GE Power informed exchanges it has won a contract worth Rs 738 crore from Aravali Power Company for Flue Gas Desulphurisation. Aravali Power is a Joint venture company of NTPC, Haryana Power Generation Company and Indraprastha Power Generation Company, which holds the Jhajjar power plant in Haryana.
In its post results media interaction, RInfra pegged its total order book at over Rs 28,000 crore. Queries sent to RInfra on the status of the NTPC projects and whether Rs 28,000 crore includes the project remained unanswered.

 For the current financial year, RInfra looks to increase its order book to close to Rs 50,000 crore. In its June 2019 presentation, the company said it targeting opportunities of about Rs 3 trillion in FY20 and bids participation in projects of Rs one trillion and is poised to build order book of Rs 50,000 crore.The other projects that RInfra is executing include the Versova-Bandra Sea Link, a package for Mumbai Nagpur Expressway, parts of the Mumbai-Metro network, Hirasar airport project in Gujarat and the Kudankulam Nuclear Power Project. Of these, the Sea-link project for Rs 7,000 crore is also facing land and other clearance issues unrelated to RInfra.