Lenders to convert a part of Rs 3500 crore loan of Shiv-Vani Oil into equity

MUMBAI: Lenders of Shiv-Vani Oil & Gas Exploration Services would soon convert a part of their Rs 3500 crore debt into equity under the strategic debt restructuring (SDR) scheme. The company informed the stock exchange about SDR and increase authorised capital from Rs 230 crore to Rs 600 crore. Promoters hold 27% stake in the company followed by ICICI Bank with 9.88%, L&T Finance with 3.77% and Templeton Strategic Emerging Markets Fund holding 7.2% stake in the company. The company has a long term loan of Rs 3563 crore and a short term loan of Rs 442 crore as on March 2015.

The loan of the company was restructured a year ago wherein the lenders had the right to convert debt into equity in case of the default. Sources from the banking circle said that inability of the company to meet its liabilities has prompted lenders to initiate SDR- a rule that allows lenders to convert debt into 51% equity.

The company’s shares closed at Rs 6.60 while its market cap stands at Rs 33.95 crore. It reported a loss of Rs 138 crore on June 2015 on a revenue of Rs 25 crore.