NCLAT approves sale of 874 MW Indian wind portfolio

Infrastructure Leasing and Financial Services Ltd (IL&FS) has received approval from the judge appointed by India’s National Company Law Appellate Tribunal (NCLAT) on the proposed sale of Wind Energy subsidiaries to ORIX Corporation of Japan.

The approval has been granted on the conditions that the proposal will now be placed before the NCLT for its approval and the bid amount realized from the sale be kept in an Escrow Account. This amount in Escrow account will only to be disbursed in accordance with the directions in the proceedings, pending before NCLT/NCLAT, as applicable.

ORIX Corporation of Japan, owner of 49% stake in each of 7 operating wind power plants of the IL&FS Group, had expressed its intent to buy out the remaining 51% stake held by IL&FS Wind Energy Limited (IWEL). This intent to buy 51% stake was in exercise of ORIX’s right under the terms of an existing MoU wherein ORIX can match the Price offered by the highest bidder for purchasing IWEL’s Stake in the Wind SPVs.

ORIX Corporation decided to match the offer of the highest bidder, GAIL Ltd, of approximately INR48 billion (US$696 million) for 100% of Enterprise Value, contemplating no hair cut to the debt of the SPVs aggregating to approximately INR37 billion (US$536 million).

The Board of IL&FS has already approved the sale of these entities to ORIX Corporation in its Board meeting held on June 28, 2019.