Reliance Communications (RCom) on Wednesday said its board will meet on August 12 to review matters regarding the proposed merger with Aircel and look into conversion of debt to equity shares, if and when needed.
In a filing to the BSE, the Anil Ambani-owned company stated ‘the board will consider, review and approve matters relating to scheme of arrangement between the company and Aircel Ltd submitted to the National Company Law Tribunal (NCLT)’. The statement adds that the board will also look into other deleveraging measures undertaken/to be undertaken by the company during the annual general meeting this Saturday.
The shareholders’ approval will be taken if there is any consideration of conversion of bond to equity shares if and when needed for issue of nonconvertible debentures/other debt securities and update all on the ongoing debt restructuring.
Shares of RCom closed at Rs 22.30, down by 2.62 percent, on the BSE on Wednesday. The Ambani-owned telecom operator is also expected to declare its first quarter results on Saturday. On Thursday, the NCLT is expected to give its decision on whether the proposal of RCom’s merger with Aircel should be admitted to be heard by the tribunal or not.
The USD 6-billion merger of debt-ridden telecom operators RCom and Aircel has already received approvals from the Securities and Exchange Board of India (SEBI), Competition Commission of India (CCI) and both the BSE and NSE.
The telco has earlier said that it is running against time to complete the merger with Aircel and stake sale in its tower business. The beleaguered telecom company, which has defaulted on some repayment obligations, needs to complete the merger as well as the tower sale within the seven-month breather it has from lenders, which expires in December. After December, RCom’s account will turn into a nonperforming asset and lenders can convert their loans to equity and take over the company.
However, RCom has said that it plans to complete its merger with Aircel and tower stake sale by September which will help it lower its Rs 45,000-crore debt by 60 percent. – At Funky