Cash-strapped hospitality chain Hotel Leelaventure defaults on payment of quarterly interest to LIC
Hotel Leelaventure said its operating cash flows are not sufficient to service its term loans and NCDs
New Delhi: Cash-strapped hospitality chain Hotel Leelaventure has defaulted in payment of quarterly interest of Rs 2.12 crore to Life Insurance Corporation of India (LIC).
Hotel Leelaventure, which currently has a debt of over Rs 3,600 crore, had issued secured redeemable non-convertible debentures (NCDs) on private placement basis aggregating to Rs 90 crore to LIC in December 2008.
"The company has defaulted in payment of quarterly interest of Rs 2.12 crore, which was due on 19 September, 2018," Hotel Leelaventure said in a regulatory filing.
Hotel Leelaventure said its operating cash flows are not sufficient to service its term loans and NCDs and the funds of the company are escrowed with its lenders and are also monitored by the lenders.
"The company is evaluating various options for a viable restructuring, including sale/monetisation of non-core assets, sale of hotels, equity infusion and debt refinancing by investors, etc," it added.
Hotel Leelaventure said the total interest outstanding as on date is Rs 13.80 crore and principal redemption amount outstanding as on date is Rs 45 crore.
Earlier this month, Hotel Leelaventure got its shareholders approval to sell the company's land in Pune to Leela Lace Holdings Pvt Ltd for a consideration of Rs 130 crore.
Life Insurance Corporation on Monday said there is no proposal to merge its subsidiary LIC Housing Finance Ltd (LICHFL) with any other entity
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In August, the Union Cabinet had approved LIC's proposed acquisition of up to 51 percent stake in debt-ridden IDBI Bank.
The permissible limit for insurance companies to hold a stake in any listed entity is 15 percent at present.