September 28, 2018 / 1:49 PM / 2 months ago

India's Life Insurance Corp open to taking part in IL&FS rights issue

MUMBAI, Sept 28 (Reuters) - Life Insurance Corporation, India’s largest state-run insurer, is open to participating in a rights issue by debt-ridden Infrastructure Leasing & Financial Services (IL&FS), the insurer’s chairman V.K. Sharma told reporters on Friday.

IL&FS is a major Indian infrastructure finance and construction company, which has built up big debts and is now facing a credit crunch.

IL&FS’s board in August approved raising funds via a 45 billion Indian rupee ($620.65 million) rights issue and a 30 billion rupee debt-reduction plan through asset sales.

The insurer might also look at raising its equity stake in IL&FS, subject to regulatory permission, Sharma said, adding that the value of assets of the IL&FS was 600 billion rupees.

Sharma and Ranjish Kumar, chairman of State Bank of India, were set to meet India’s economic affairs secretary on Friday to discuss the IL&FS crisis, a source familiar with the matter said.

IL&FS’s other major shareholders also include Japan’s Orix Corp and the Abu Dhabi Investment Authority, according to the company’s website up to the end of the financial year to March 2018. ($1 = 72.5050 Indian rupees) (Reporting by Manoj Kumar in New Delhi and Abhirup Roy in Mumbai. Editing by Jane Merriman)

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