New Delhi, July 2, 2009: The Board of Directors of IL&FS Engineering and Construction Company Limited met today, 2nd July 2009, at New Delhi and discussed the issues related to Corporate Debt Restructuring (CDR), Business Plan, Realization of Current Assets including the recovery of Inter Corporate Deposits (ICDs).

The Board acknowledged with thanks the approval of Corporate Debt Restructuring Package by CDR Empowered Group on 30th June 2009 and wishes to place on record the excellent support extended by all lenders led by ICICI, SBI & IDBI Banks. The Company had requested for sanction of additional facilities of Rs. 200 crore fund-based and Rs. 400 crore non fund-based with Rs. 100 crores fund-based and Rs. 200 crores non fund-based to be released immediately with balance to be made available in next 3 months based on Company’s performance and the same was accepted by the lenders. All other terms & conditions such as moratorium, interest rates, repayment schedule etc have been mutually discussed and agreed to with the lenders.

The Board reviewed the business plan and advised the management to ensure that the commitments made to various stakeholders in respect of turnover, profitability, new business and related aspects are strictly adhered to. The board considered the position of debtors, inventories and ICDs. The Board decided that serious efforts have to be put in to realize the debtors and recover the ICDs. The recoveries made from this are to be used to reduce the outstanding debt to the banks. Board is of the view that recovery of Rs 390 crores worth of ICDs will help significantly in reducing the debt burden of the Company. Money realized through realization of ICDs will be utilized to repay bank loans.

With the availability of working capital and restructuring of debt, the Company will now be in a position to effectively & expeditiously execute not only the existing contracts, but also bid & secure new contracts.