RCom shares plunged as much as 54 percent to an intra-day low of Rs 6 per share on Monday.
Reliance Communications (RCom) shares settled at Rs 7.55, down by almost 35 percent on Monday at close. The defunct telco's stock had slumped 54 percent in intra-day trade after the company on Friday said it would file for bankruptcy proceedings as it failed to sell its assets for paying back its lenders. RCom shares plunged as much as 54.3 percent to a low of Rs 6 per share intraday on the NSE.
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At 10.25 am, the RCom stock price was trading at 7 per share, down 39.66 percent from its previous close. 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.
Fitch Ratings said it estimates most lenders will not be fully paid. It was very difficult for RCom to get consensus from 40 lenders, and the NCLT process ensures the debt resolution process is completed within 270 days, noted Fitch. Computation of total realizable value is difficult as there is lot of real estate in the asset mix.
Anil Ambani-led RCom on Sunday said it will propose a similar debt resolution plan to the NCLT that it had been pursuing outside the court. 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.
"The Company has been faced with various mostly, untenable issues raised by the Department of Telecommunications. 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. Further, challenges raised by unreasonable minority lenders can be now be overcome through the NCLT's 66 per cent majority rule, against the 100 per cent approvals rule outside NCLT," RCom said.
In a relief to RCom, the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) on Monday directed the Department of Telecommunications to release Rs 2,000 crore bank guarantee provided by the company. The Tribunal order will reduce non-funded exposure of banks by Rs 2,000 crore and help in accelerating RCom’s asset monetisation programme for Rs 25,000 crore, which was announced earlier.
The company is learnt to be under a debt of Rs 38,000 crore excluding interest which includes Rs 19,800 crore that it owes to Indian lenders and around Rs 18,200 crore debt from foreign lenders, noted the PTI report, citing a source.
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First Published: Feb 4, 2019 9:27 AM IST