RCom creditors oppose insolvency petition
By Nick Wood, Total Telecom,
China Development Bank reportedly filed lawsuit in bid to recover $1.78 billion from Indian operator
Reliance Communications on Thursday said that most of its creditors do not support an insolvency petition filed by China Development Bank (CDB).
The Economic Times reported earlier this week that CBD filed the petition at India's National Company Law Tribunal (NCLT) on 24 November in a bid to recover $1.78 billion from the beleaguered telco.
RCom in October revealed a debt restructuring deal that includes offloading key assets in a bid to repay 170 billion rupees (€2.2 billion) of debt. Its mobile spectrum, towers, media convergence nodes, and fibre infrastructure are all expected to go under the hammer.
A further INR70 billion rupees of debt will be converted into 51% of the equity of what remains of RCom, giving lenders control of the newly-slimmed-down company.
However, according to this week's ET report, the CDB's petition has extinguished any hope of RCom reaching an out-of-court settlement with its lenders.
RCom has come out fighting though, disclosing in a stock exchange announcement on Thursday that "a majority of Reliance Communications' lenders, foreign and Indian, aggregating 31, decided to oppose China Development Bank's insolvency petition against RCom."
The group has appointed legal representatives "to oppose the said CDB petition at the admission stage," RCom said.