RCOM draws down ECB of US$ 255 Mn for 3G Spectrum Refinancing

Reliance Communications Limited (RCOM) aims to raise funds in order to pay Department of Telecommunications (DoT) to procure 3G spectrum. It has drawn down US$ 255 Million (Rs. 1155 Cr) by way of External Commercial Borrowing. Reserve Bank of India has approved to US$ 1.585 Bn for refinancing 3G spectrum. This loan is funded by a consortium of banks led by Australian and New Zealand Banking Group Limited, BNP Paribas, Credit Agricole Corporate and Investment Bank, DBS Bank Limited and Intesa Sanpaolo.

RCOM will benefit from extension of maturity, and substantial savings in interest costs from this facility. In addition to the above, RCOM had earlier signed a Memorandum of Understanding (MoU) with CDB on December 15, 2010 during the visit of the Chinese Prime Minister to India, to refinance US$ 1.33 Bn paid for 3G Spectrum to DOT. The MoU also covers financing of up to US$ 600 million towards equipment and services to be procured from Chinese Vendors like ZTE Corporation and Huawei Technologies Co. Ltd. These facilities will be funded by CDB and other Chinese Banks / Financial Institutions, and their approval and draw down is expected soon.