
Reliance Communications (RCom) shares settled at Rs 7.55, down by nearly 35 percent on Monday at close.
The crisis-hit firm said it was moving for bankruptcy protection after its attempts to pare Rs 42,000 crore debt failed despite attempts over the last 18 months to sell assets and negotiate with the lenders.
Shares of Reliance Communications plunged 48 percent on Monday morning as investors reacted to developments around its debt resolution plan. The Nifty 50 was down 0.38 percent at 10,852.65 points, while the Sensex fell 0.37 percent to 36,333.19 points.
"RCom board of directors decides upon implementation of debt resolution plans through NCLT framework", the company said in a statement Friday. Computation of total realizable value is hard as there is lot of real estate in the asset mix.
More news: Instagram’s most famous egg ‘hatches’ following Super BowlDebt-laden Reliance Communications Ltd (RCom) plunged by more than half to its record low in early trade on Monday, after the company said it will seek a fast-track resolution through the bankruptcy court National Company Law Tribunal to resolve its indebtedness. The company is opting for debt resolution process to overcome the challenge of getting 100 percent lenders or creditors approval required for taking a decision around asset sale which has been hampering the process asset monetization, reported PTI, citing sources.
RCom was expecting to realise Rs 975 crore from sale of spectrum to Jio which it promised to use for paying dues of Rs 550 crore to Ericsson and Rs 230 crore to settle dues of minority stakeholder Reliance Infratel. "These issues inter alia resulted in numerous legal issues at High Courts, TDSAT and the Hon'ble Supreme Court, which frustrated the existing plan and can now be addressed/resolved under the NCLT process", said the spokesperson. Jio, Brookfield and the Department of Telecommunications could not be reached for comment.
The board of directors of RCom Friday reviewed the progress of the company's debt resolution plans since the invocation of strategic debt resolution on June 2, 2017.
The company's current debt to lenders stands at 380 billion rupees ($5.32 billion) of which it owes 198 billion to local lenders and 182 billion rupees to foreign lenders, a spokesman for RCom told Reuters.
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