RCom signs final deal for $1.93 billion China Development Bank loan
09 Mar 2011
Reliance Communications today signed the final documents with China Development Bank for a fully underwritten loan facility of over Rs8,700 crore ($1.93 billion), RCom said today.
The loan facility is fully underwritten by CDB and will be funded by a syndicate of Chinese banks and financial institutions, including CDB, Reliance Communications said in a filing with the Bombay Stock Exchange (BSE).
RCom today signed the final documents with China Development Bank (CDB) for a Rs6,000-crore ($1.33 billion) refinancing facility. RCom also signed additional agreements for Rs2,700 crore ($600 million) loan with CDB, for financing imports and meeting domestic costs of importing telecom equipment from Chinese vendors such as Huawei and ZTE.
The aggregate financing by CDB thus works out to Rs8,700 crore ($1.93 billion).
The loan for refinancing loan proceeds for payment of 3G spectrum fees and import of telecom equipment is the largest such loan in the telecom sector and the largest loan between China and India, RCom said in a release.
RCom will benefit from the extended loan maturity of 10 years and substantial saving in interest costs. The loan will result in a projected saving in annual interest cost of around Rs500 crore for Reliance Communications.
RCom, which had paid Rs8,585.04 crore to the government towards securing the 3G spectrum, has a current debt of over Rs32,000 crore.
RCom had, in May, won 13 key telecom circles during the 3G auction, including the key metros of Delhi, Mumbai and Kolkata.
It holds 3G licences in the telecom circles of Delhi, Mumbai, Kolkata, Punjab, Rajasthan, Madhya Pradesh, West Bengal, Himachal Pradesh, Bihar, North East, J&K, Orissa and Assam.
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