Pushed by LIC, Essar Oil has given an unconditional undertaking to the institution and some of the lenders that their dues would be cleared within three days of the closure of its crucial deal with the Russian firm Rosneft.
These lenders had expressed their reluctance to approve the proposed acquisition of Essar Oil by Rosneft and other offshore investors till the dues are cleared.
On Friday, Essar communicated its decision to LIC, GIC and some of the banks which insisted on settlement of loan dues, a person familiar with the development told ET.
The unconditional and irrevocable undertaking has been en cable undertaking has been endorsed by Rosneft and other strategic investors who would hold 98% of Essar Oil once Essar group promoters Ruias sell their stake. Under the circumstances Essar will have to prepay around $225 million to various lenders in persuading them to clear the deal -which is expected to revive the group and lower leverage levels of debt saddled companies like Essar Steel. Most loan covenants typically lay down that lender’s consent is necessary for a change of management. Read More…
Credit By: Energy Economic Times
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