During the visit of the Chinese prime minister to India, Reliance Communications Ltd (RCOM) has signed a Memorandum of Understanding (MoU) with China Development Bank Corporation for syndicated financing of $1.93 billion.
The proposed facility has 10 year maturity, and will be funded by a Syndicate including CDB and other Chinese banks. RCOM will benefit extension of maturity, and substantial savings in interest costs.
The facility is subject necessary approvals.
The MoU covers: the first and largest syndicated loan of $1.33 billion for refinancing spectrum fees; and financing of up to $600 million towards 85% of equipment and services be procured from Huawei Technologies Co. Ltd (Huawei) and Corporation (ZTE). This facility is above the existing $750 million facility, already substantially utilized by RCOM for procurement of equipment and services from Huawei and ZTE.
On Wednesday, RCOM ended 0.86% up at Rs129.10 on the Bombay Stock Exchange, while the benchmark Sensex declined 0.76% to 19,647.77 points.
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