Infrastructure firm IL&FS is seeking intervention from the government and regulatory agencies in order to overcome the present crisis. The development comes after LIC, SBI key shareholders including LIC and SBI asked it to raise funds by selling its assets or non-core businesses as a pre-condition for putting in additional money in the firm, sources said.

The shareholders held a meeting Wednesday and it was decided that additional money would be given when Infrastructure Leasing & Financial Services (IL&FS) generates cash on its own by selling some of its assets, the sources said.

IL&FS is seeking an immediate loan of around Rs 3,000 crore from key shareholders to help it tide over a cash crunch.

State-run LIC is the largest shareholder owning a fourth of the firm's equity, while Orix Corporation of Japan owns 23.5 percent.

Other shareholders include Abu Dhabi Investment Authority with 12.5 percent stake, Central Bank of India with 7.67 percent and SBI with 6.42 percent.

According to sources, the company will sell its corporate headquarters in Mumbai as part of its plan to raise funds to meet the payment obligation.

Earlier this month, IL&FS defaulted on inter-corporate deposits and commercial papers.

On September 4, it came to light that IL&FS had defaulted on a short-term loan of Rs 1,000 crore from Sidbi, while a subsidiary has also defaulted on Rs 500 crore dues to the development financial institution, which reportedly forced Sidbi to ask its chief general manager in charge of the risk management department to resign.

In a letter to its employees, IL&FS claimed that if funds worth Rs 16,000 crore stuck with concession authorities were released on time, it would not have landed in this mess.

"Our monies were used to fund the cost and time overruns caused by concession authority delays in handing over right of way.

"It is our case that if concession authorities released our monies, which is around Rs 16,000 crore of IL&FS group liquidity and stuck in claims and termination payments, we would not be in the situation that we are in," IL&FS said in its letter.

The management also claimed that sufficient clarity will emerge after the September 15 board meeting.

IL&FS, which is credited for building the longest tunnel in the country (the Chenani-Nashri tunnel), is sitting on a debt pile of around Rs 91,000 crore and had been downgraded to junk status by rating agencies following the default. Of this, Rs 57,000 crore are bank loans alone, most of which are from state-run lenders.

While IL&FS Transport Network, the holding firm of the group's road assets, has nearly Rs 35,000 crore consolidated debt, IL&FS Financial Services has Rs 17,000 crore of debt, which sits as standard asset for most banks, according to a Nomura India report.

(With PTI inputs)

First Published:Sept 13, 2018 7:50 PM IST