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While the continued depreciation in Indian currency and global financial turmoil have posed challenges to Indian companies that have to redeem Foreign Currency Convertible Bonds (FCCBs) in the near term, Reliance Communications Ltd (RCom) has sprung a coupe by striking a deal with financial institutions to meet the entire redemption commitment of $1.18 billion (approximately Rs 6,125 crore).
This is the largest FCCB refinancing deal by any Indian corporate, the company claimed in its filings with the stock exchanges today.
Three of the lenders with whom RCom has tied up to refinance the entire redemption amount, due on March 1, 2012, are Chinese financial institutions. RCom, without disclosing the individual exposure of each of the lending institutions, said that it would benefit from the extended loan maturity of 7 years and the loan would carry an interest rate of about 5 per cent.
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