MUMBAI - India's ailing Infrastructure Leasing and Financial Services Ltd (IL&FS) said on Friday its newly-appointed board had begun cutting cost in staffing and unspecified operations as the first step in their efforts to revive the company.
The Indian government replaced the entire IL&FS board earlier this month after defaults on some of its debt triggered sharp falls in stock and debt markets, sparking fears about contagion in the country's financial sector.
Often referred as a quasi-sovereign entity because India's state-owned Life Insurance Corp Ltd holds a 25 percent stake in it, the other large investors in IL&FS are Japan's ORIX Corp with a 23.54 percent stake and Abu Dhabi Investment Authority (ADIA) with 12.56 percent.
India's biggest lender by assets, State Bank of India also owns a 6.42 percent stake.
IL&FS said in a statement that its new board had also approved the formation of an operating committee under vice chairman and managing director Vineet Nayyar and "had detailed deliberations in relation to the road map ahead".
The new six-member board was formed to revive the financier and infrastructure developer, which has 348 subsidiaries and 910 billion rupees ($12.4 billion) of debt, after the government intervention.
IL&FS said the new board will also conduct a full audit of the standalone and consolidated accounts up to Sept. 30, 2018, adding that it had replaced the nominee directors of IL&FS at its subsidiaries and nominated new ones from the board.
($1 = 73.5600 Indian rupees)
(Reporting by Promit Mukherjee; Editing by Euan Rocha and Alexander Smith)