Franklin’s shut debt schemes get Rs 1,964 crore from investments

Franklin Templeton has told investors in its six debt schemes that are being wound up that the plans received Rs 1,964 crore as routine proceeds from their investments, and that two of the funds featuring in the unusual list of terminated programmes have repaid their loans to banks.

Sanjay Sapre, president of Franklin Templeton India, said the money came in over the past couple of months from maturities, pre-payments and coupon payments since the money manager decided to close the six investment plans – the first such closures in India’s active asset-management industry.

Two of the schemes undergoing winding-up have surplus cash, another two of the schemes have repaid their bank borrowings and are cash positive, and in one scheme, the borrowing level has nearly halved to 11.25 per cent, Sapre said in a letter.

“Cash in the schemes can be paid to unitholders only after receiving consent through e-voting. The e-voting and unitholders’ meet for the six schemes under winding up cannot be conducted until the stay order issued by the Gujarat High Court is vacated,” read the letter. “In the meanwhile, we have been working to analyse the portfolio of each scheme and develop a monetisation strategy for each of the securities in the portfolio.”

Sapre told unitholders that all legal cases relating to the winding up of these six schemes will be transferred to a division bench of the Karnataka High Court and the Supreme Court has directed the matter be completed within three months.