Tata Teleservices, the loss-making telecom services provider of the Tata group, had asked banks to restructure loans worth Rs 29,000 crore following a Rs 11,650 crore erosion in its net worth in 2016-17, banking sources told the Business Standard. Tata Teleservices joins Anil Ambani-owned Reliance Communications in seeking a bailout from banks since the launch of services by Reliance Jio, the financial daily said on Saturday.
The Economic Times reported that the company has approached a lender consortium led by the State Bank of India (SBI) for restructuring outstanding debt of Rs 32,000 crore, underscoring financial stress in the telephony business.
Debt-laden TTSL will be the second telco seeking restructuring after Anil Ambani-owned Reliance Communications which on Friday received the nod from lenders under a Joint Lender Forum (JLF) scheme by the Reserve Bank of India, allowing it a 'standstill' on all its debt for seven months: The reprieve means the telco won't need to service loans or accrue interest on its bank borrowings.
RCom has net debt of about Rs 45,000 crore at March end. In comparison, total debt of TTSL is around Rs 40,000 crore, of which Rs 8,000 crore is deferred spectrum payments.
Besides Tata Sons, Tata Steel, Tata Industries, Tata Communications and Tata Power are involved in the deal, ET said. For some time, the telecom firm has been an Achilles' heel at one of India's oldest business groups.
Former chairman of Tata Sons Cyrus Mistry, in one of his letters to the board right after his ouster, said the business was "continuously haemorrhaging".
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