RCom to launch tender offer for repurchase of bonds

Reliance Communications Ltd has announced that the Company had issued Foreign Currency Convertible Bonds of US$ 1 billion (current outstanding US$955 million) due in 2012 (the "Bonds").

The Company intends to repurchase for cash an aggregate principal amount of the outstanding Bonds for an amount to be determined by the Company at its sole discretion, by way of an invitation to holders of Bonds to tender their Bonds for repurchase. The Company proposes to dispatch to Bondholders a Tender Offer Memorandum setting out, inter alia, the terms and conditions of the Invitation to Tender.

The Invitation to Tender will commence on April 15, 2009 and will expire on April 17, 2009 unless extended, re-opened or earlier terminated as provided in the Tender Offer Memorandum.

The Company has applied to the Reserve Bank of India (the "RBI") for approval to repurchase a principal amount of the outstanding Bonds in excess of US$ 50 million using the Company's internal accruals. Settlement of the Tender is conditional on, inter alia, receipt by the Company of approval from the RBI in form and substance satisfactory to the Company pursuant to the application made to the RBI.

The stock closed on Monday at Rs.219.20, up by Rs.7.40 or 3.49%. The stock hit an intraday high of Rs.224 and low of Rs.213.

The total traded quantity was 4284975 compared to 2 week average of 4662325.

Source : Equity Bulls

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