GTL Limited Faces Winding-Up Petition In Bombay HC

Mumbai based network service provide GTL Limited is unable to meet its commitment under the corporate debt restructuring (CDR) package it had received in FY11. According to a senior official from the company, adverse conditions in the telecom sector have made it difficult for the company to meet its obligations.

“The lenders had envisaged a buoyant telecom sector as well as the power sector at the time of approving the CDR package in FY11. However, the conditions worsened,” said the senior official.

However, factors such as cancellation of 2G licenses, slower 3G growth, suspension of Aircel’s tenancy commitments among others have adversely impacted the company’s books.

Following the company’s inability to meet the obligations under pari-passu treatment to ECB and NCD lenders, notices have been sent to the company. “ The notices have asked the company to not make any further payments to CDR lenders till ECB (External commercial borrowings) lenders and NCD (non-convertible debentures) lenders are paid. Also, the company will have to share the proceeds of TRA account on pari-passu basis with the CDR lenders,” noted the official.

It should be noted that the ECB lenders of the firm have also filed recovery proceedings in the Courts of London last year while the NCD lender has filed a winding-up petition in the Bombay High Court on January 9, 2015. “The company received the notice on January 16, 2015,” noted the official. The company has made a disclosure to the National Stock Exchange (NSE) as well.

Representational Image: Indiatimes.com