Fitch withdraws RCom rating for commercial reasons
New Delhi: Credit rating agency Fitch on Wednesday said it has withdrawn ratings of debt-ridden Reliance Communications Ltd (RCom) for commercial reasons.
“Fitch has chosen to withdraw the ratings on Rcom for commercial reasons. Accordingly, Fitch will no longer provide ratings or analytical coverage for RCom,” it said in a statement.
RCom also informed stock exchanges that Fitch “has withdrawn ‘C’ rating of the company’s Long-Term Foreign and Local Currency Issuer Default Ratings and Bonds listed in Singapore Stock Exchange due to commercial reasons”.
RCom said it has already informed all the stakeholders that the lenders of the company have invoked strategic debt restructuring (SDR) scheme as per RBI guidelines. “...pursuant to the said guidelines, the company is under standstill period till December 2018. The Company has also announced various asset sales and a comprehensive debt resolution plan...Accordingly, for the time being, no payment of interest and/or principal is being made to any lenders and/or bondholders of the company,” RCom said.
RCom is estimated to be in debt of around Rs45,000 crore. Various entities, including China Development Bank and PR firm Fortuna Public Relations have filed insolvency case against RCom.
In case of Fortuna, RCom said quality of service and amount billed by the PR agency are disputed. It added that the bill of Rs47.65 lakh raised by the PR agency is not material to the company.
On Tuesday, RCom shares fell 1.73% to Rs11.34 on the BSE while the benchmark Sensex shed 0.20% to end the day at 32,802.44 points.
Reliance Group companies have sued HT Media Ltd, Mint’s publisher, and nine others in the Bombay high court over a 2 October 2014 front-page story that they have disputed. HT Media is contesting the case.