RCom gets relief from overseas bondholders; plan cleared for a 42% haircut

RCom defaulted on the bonds last year after it failed to repay its debt worth Rs 447 billion to Indian banks

In a development that takes it closer to averting bankruptcy proceedings, Reliance Communications (RCom) has secured approval of its overseas bondholders for the revised terms. The Anil Ambani-owned company had defaulted on a $300-million bond last year.

In a meeting held in London on Friday, over 83 per cent of those holding the bonds, now due in 2020, cleared the plan. According to the revised proposal, RCom will offer cash up to $118 million and $55 million bonds, to be issued by Global Cloud Xchange, the holding company of GCX, an overseas subsidiary of RCom. 

Following the agreement, the bondholders