New Delhi: Debt-ridden Reliance Communications said on Wednesday its shareholders have approved a cap of ₹ 50,000 crore on its borrowing limit.
The resolution to revise borrowing limit was passed as special resolution by around 90% of shareholders at the annual general meeting of the company held on 18 September 2018, RCom said in a BSE filing.
It was proposed that AGM will resolve that any committee that the board may form to borrow money in rupees or foreign currency to together with monies already borrowed by the company , apart from temporary loans from the company’s bankers in the ordinary course of business and “outstanding at any point of time shall not exceed ₹ 50,000 crore".
Riddled with debt of over ₹ 40,000 crore, RCom Chairman Anil Ambani on Tuesday announced that the company will completely exit the telecom business to concentrate on real estate in future.
RCom owes over ₹ 40,000 crore to a group of 38 lenders, including Chinese banks, and was resolving the debt through a strategic debt restructuring (SDR) process.
Ambani said there has been a “creative destruction" of the telecom sector that has resulted in creation of oligopoly which is going towards a duopoly and may be even a monopoly in the future. He added that the banks are saddled with over ₹ 7.7 trillion in debt and the financial troubles of operators have resulted in over 20 lakh job losses in the sector.
Among other resolutions approved at the AGM, shareholders approved elevation of RCom President for telecom business Punit Garg as executive director of the company. He has been part of senior management team at RCom since 2002. The shareholders also approved appointment of Manikantan V as a Director and Chief Financial Officer of RCom.
Reliance Group companies have sued HT Media Ltd, Mint’s publisher, and nine others in Bombay high court over a 2 October 2014 front-page story that they have disputed. HT Media is contesting the case.