Hyderabad, Sep 1 (Inditop.com) Infrastructure Leasing and Financial Services (IL&FS), the new management of city-based construction firm Maytas Infra, Tuesday said it would look at recapitalising the company through routes like a qualified institutional placement (QIP).
“I think we need to recapitalise the company. Over the last 10 months, the company has suffered an erosion in net worth of a very significant amount, something like Rs.490 crore for the year ended March 31,” said IL&FS chairman Ravi Parthasarathy at a press conference after a Maytas board meeting here.
“If we have proper capitalisation done possibly through QIP, we would then like to take Maytas to the next level of expertise in construction by bidding jointly with it for various construction projects,” added Parthasarathy.
QIP is a capital raising tool whereby a listed company issues equity shares, fully and partly convertible debentures or securities other than warrants to institutional buyers.
A Company Law Board (CLB) order Monday had given management control of Maytas Infra to IL&FS, which is the single biggest shareholder with a 37.1 percent stake in the cash-strapped company.
The order however restrained the company from reducing its stake below 26 percent for two years.
Parthasarthy also sought to dispel suspicion of fraud having been committed at Maytas.
“It has done nothing wrong, than being in the vicinity of Satyam and suffering collateral damage. Most of the problems arising in Maytas is attributable to the collateral damage,” he said.
IL&FS now has to go for an open offer to acquire a further 20 percent under takeover guidelines of the market watchdog, Securities and Exchange Board of India (SEBI).
“I expect this will take a maximum of 21 days beginning from tomorrow (Wednesday),” said Parthasarthy.
The new management, which is required to infuse up to Rs.55 crore as liquidity support according to the CLB order, said it had already made available about Rs.50 crore to the company to kick start operations.
“The company is still going through a very difficult period. It will probably take at least a year if not more to restore stability,” said Parthasarthy.
