World’s fifth largest wind turbine- maker Suzlon Energy is planning to raise up to $400 million by selling 15 of its non-core assets in a bid to partly retire the huge debt pile of nearly Rs. 14,600 crore, a top company official has said.
Earlier, the company was planning to raise $100 million.
“We have identified 15 non-core assets, mostly in overseas markets like China, US, etc, which we plan to sell in the next 12-18 months in a phased manner. We expect to realize nearly $300-400 million through the sale process,” chief financial officer Kirti Vagadia told PTI here.
The company has already initiated the process to sell stake in its wholly-owned Chinese subsidiary Suzlon Energy Tianjin, through which it will realise $60 million, or Rs. 338 crore. He also said the entire proceeds from these planned sales will go into retire debt.
Suzlon is also planning to sell stake in its forging business SE Forge.
“We are also looking at selling some of our components manufacturing facilities in the country,” he said, adding, “We will outsource such products to ensure cost reduction.”
This is a part of Suzlon’s cost cutting and debt reduction programme, Mr Vagadia added.
The company, which got a lifeline from its lenders in January with Rs. 9,500 crore debt restructuring, has embarked on a plan to reduce debt and interest by selling non-core assets and cut its fixed costs by nearly 20 per cent.
As part of this strategy, the Pune-based company has so far laid off 750 jobs in its German subsidiary REpower. The company has a total workforce of around 13,000 across 32 geographies it is operating in.
The company late March created history by becoming the first firm in entire Asia, ex-Japan to raise $647 million in overseas bond sale, which was guaranteed by its lead banker SBI as part of its plan to retire its $650 million forex loans.
However, Suzlon is still talking to settle the $221 million with FCCB bondholders following the default last October.
“We have embarked on our cost cutting plan and we may lay off some more jobs in the future as well,” Mr Vagadia said, but ruled out job cuts in the domestic market.
Suzlon Group says its S97-2.1 MW wind turbine has been upgraded to handle higher wind speeds in a 60 Hz version for application in the North American market.
The company says the S97 will achieve higher average wind speed operation through modifications to the controller software and use of enhanced blade fiberglass materials. The S97 will be available for delivery in December.