HCC to raise Rs. 1,750 crore, pare its debts

Mumbai-based engineering company, Hindustan Construction Company (HCC) agrees to a proposal to monetize its arbitration awards and claims to raise around Rs. 1,750 crore.

HCC informed the exchanges that it has signed a pact with a consortium of investors led by BlackRock to transfer its beneficial interest and rights in an identified portfolio of arbitration awards and claims to special purpose vehicle (SPV). The transaction will be controlled by a consortium of investors led by Black Rock.

The company will receive a consideration of Rs. 1,750 crore from the SPV, which will be utilised to prepay debt of Rs. 1,250 crore, including its entire term loan of Rs. 942 crore which is due in the next three years and Rs. 308 crore of Optionally Convertible Debentures (OCDs). The balance Rs. 500 crore will be made available to fund working capital needs and business growth.

Hindustan Construction Company is part of HCC Group, which is engaged in the business of providing engineering and construction services. The company has executed major projects such as hydropower generation and nuclear power plants.

On Tuesday, the stock price soared more than 9 per cent and closed at Rs. 15.64 on BSE. The benchmark index BSE Sensex closed with stellar gains of 424 points at 38,233.41.