Tulsi Tanti in Calcutta on Thursday. Picture by Kishor Roy Chowdhury
Calcutta, April 10: Wind turbine maker Suzlon Energy will get rid of non-core assets in the coming months to meet its working capital requirements.
The Pune-based company, which is going through a Rs 9,500-crore corporate debt restructuring programme, had an outstanding debt of Rs 14,495 crore at the end of the third quarter of 2013-14.
The sale of assets is likely to help the company to garner additional liquidity and improve its working capital, which decreased to Rs 1,490 crore at the end of the third quarter of 2013-14 against Rs 4,311 crore in the corresponding year-ago period.
Tulsi Tanti, chairman and managing director of Suzlon Energy, said the company had lined up the sale of assets worth over Rs 1,000 crore, mostly in real estate.
“We have lots of non-critical assets and for some of the assets, the real estate value has gone up,” Tanti said on the sidelines of a CII event here today.
He added that the assets were primarily local, with some of them located in Pondicherry and Vadodara. The company has been on a selling spree to increase liquidity for quite some time.
Only yesterday, it announced the sale of a 240-megawatt wind farm in Illinois, which was acquired from the US firm Edison Mission Energy.
Tanti said the proceeds from the deal were expected to add to the cash flow within a month.
“By selling assets we can bring in the much-needed cash into the system,” he said.
According to Tanti, the financial crisis in the US along with a slowdown in demand were the major reasons for the company’s financial trouble. Suzlon earns more than 70 per cent of its revenues from overseas.
Much of the debt raised by the company during the period could not be converted into equity at a later stage.
However, Tanti said the financial restructuring plan would help the company to improve its balance sheet over the next few months. At present, the company has an order book of $8 billion.