RCom gets Chinese banks to refinance Rs 6,125 cr loan
Reliance Communications, the telecom arm of Anil Ambani-led group, on Tuesday said three leading Chinese banks have agreed to refinance its outstanding foreign loans worth Rs 6,125 crore, making it the biggest ever overseas loan refinancing arrangement by any Indian company. The refinancing for RCOM’s outstanding FCCBs (Foreign Currency Convertible Bonds) worth USD 1,182 million (Rs 6,125 crore) would be provided by Industrial and Commercial Bank of China (ICBC), China Development Bank (CDB) and Export Import Bank of China (EXIM), among others.
Helped by the refinancing arrangement reached by debt-ridden telecom major, the RCOM shares soared over 5 percent in early morning trade and was trading 3.12 percent higher at Rs 89.15 after paring some initial gains.
The loan proceeds would be used for refinancing the entire redemption amount of FCCB which are due for redemption on March 1, 2012, RCOM said, while adding that, “this is the largest refinancing in the history of FCCBs by any Indian Corporate.”
The company said it will benefit from the extended loan maturity of seven years and an attractive interest cost of about 5 percent.
As of quarter ended September 2011, the company has a debt amounting to nearly Rs 32,000 crore.
FCCBs are bonds that are issued in currencies different from the issuing company’s domestic currency.
Reliance Communications is the flagship company of Anil Ambani-led Reliance Group. The group currently has a net worth in excess of Rs 89,000 crore (USD 19.7 billion), cash flows of Rs 10,900 crore (USD 2.8 billion), net profit of Rs 3,600 crore (USD 0.8 billion).
Comments are closed.
Your Comments