Sadbhav Engineering Limited Enters Master Restructuring Agreement for Debt

Sadbhav Engineering Limited Enters Master Restructuring Agreement for Debt​

Sadbhav Engineering Limited announced on March 26, 2026, that it has entered into a Master Restructuring Agreement (MRA) with a majority of the consortium lenders for a debt restructuring plan.

The MRA, executed on March 25, 2026, involves debt aggregating to Rs. 1,516.71 Crores, comprising a fund-based exposure of Rs. 906.35 Crore and non-fund based limits of Rs. 610.36 Crore. The fund-based exposure will be restructured as convertible debentures.

Parties Involved and Terms of Agreement

The MRA was executed by Sadbhav Engineering Limited, IDBI Trusteeship Services Limited (as security and debenture trustee), and the following lenders: Punjab National Bank, Union Bank of India, Axis Bank Limited, Assets Enterprise Limited, Bank of India, Yes Bank limited, and Care & Reconstruction. Provisions have been included for additional lenders to accede to the agreement at a later date.

The agreement formalizes the terms of the restructuring plan, in accordance with the Reserve Bank of India’s stressed assets restructuring framework. Key terms include:

• Lenders have the right to appoint nominee directors.
• The company is obligated to convert a portion of interest obligations on debentures into equity, alongside the conversion of promoter debt, both existing and additionally infused, into equity.
• The issuance price for equity will be determined in accordance with RBI guidelines and SEBI regulations.

Existing Loan Agreements

The MRA relates to various underlying loan agreements, including a loan agreement entered into on March 18, 2008, and subsequent supplemental agreements dated February 19, 2010, August 29, 2011, March 18, 2016, September 27, 2018, and August 12, 2021.

Existing security held by the consortium will be extended for securing the debentures.

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