RCom plans to cut debt to Rs 6K cr, will sell some spectrum, towers, real estate
Reliance Group chairman Anil Ambani said the entire monetisation process to repay debt of lenders will be completed by January-March 2018.business Updated: Dec 26, 2017 16:53 IST
Reliance Communications Ltd outlined on Tuesday a new plan under which it aims to reduce its debt by about Rs 25,000 crore through the sale of some of its spectrum, tower and real estate assets.
The reduction would allow the company to provide “zero” write-offs to lenders and bondholders, as well as no conversion of debt to equity, Anil Ambani, the businessman backing the company, told a news conference, adding foreign lenders have supported the plans.
“We have achieved resolution that involves Reliance Communications exiting strategic debt recast. Clearly and truly this is a historical achievement for any group,” Ambani said.
Reliance Communications had close to Rs 45,000 crore debt on its books in October 2017.
RCom, as the company is widely known, would have debt of below Rs 6000 crore after the asset sales, which are expected to close between January and March 2018, Ambani added. The company’s shares rose as much as 38% on the news.
RCom has struggled under a heavy debt load and has reported a string of losses during a price war in the highly competitive Indian telecoms market, prompting it to announce a partial shutdown of operations.
China Development Bank last month initiated insolvency proceedings at India’s National Company Law Tribunal (NCLT), saying a large amount of principal and interest from RCom was overdue.