Reliance Communications share price tanks 10% as it halts paying interest on NCDs
Reliance Communications said last month it expected to complete its Rs 18,100 crore asset sale to Reliance Jio Infocomm and Canada’s Brookfield in coming weeks, a move aimed at reducing its debt.
Reliance Communications share price cracked over 10 per cent on Tuesday after the company said it would not pay interest on its non-convertible debentures (NCDs) until its restructuring process is completed.
The stock slid as much as 10.15 per cent to Rs 14.15 on the BSE. The stock has lost more than half its value this year up to Monday.
Reliance Communications said last month it expected to complete its Rs 18,100 crore asset sale to Reliance Jio Infocomm and Canada’s Brookfield in coming weeks, a move aimed at reducing its debt.
Last week, NCLAT stayed bankruptcy proceedings against the company after it agreed to pay Rs 550 crore to Ericsson to settle a payment dispute.
The NCLAT clears the way for Anil Ambani-led RCom to sell its telecom towers, spectrum and fibre assets to Reliance Jio.
A two-member bench headed by NCLAT Chairman Justice S J Mukhopadhaya directed RCom and its subsidiaries Reliance Infratel and Reliance Telecom to pay Rs 550 crore to Ericsson India in 120 days, failing which it will direct insolvency proceedings against the company.
Meanwhile, in a statement yesterday, RCom said its management has been reinstated by NCLAT's order.
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"RCom's management and board of directors have been reinstated vide this order," RCom spokesperson told PTI.
"RCom expects to now complete the sale of its assets within the next few weeks, having removed legal hurdles of cases by minority investors of RITL, and Ericsson, thereby achieving an overall debt reduction of approximately Rs 25,000 crore from the first phase of its asset monetisation programme," he added.
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