Tulip Telecom is currently in talks with various lenders to restructure its debt with longer maturity periods under the corporate debt restructuring mechanism, including a moratorium on principal and interest payments, say news reports.
It is believed that this exercise would lead to better liquidity for the company and help it strengthen its core operations.
Commenting on the same, Lieutenant Colonel H.S. Bedi, chairman and managing director, Tulip Telecom, says, “Tulip has built a strong infrastructure for its enterprise data business, which involves significant investments. The company, in consultation with its senior secured lenders, has taken the decision to restructure the debt so as to enable the company to repay its debt over a longer period, thus easing the debt and interest burden. Our senior lenders have shown support for our long-term business plans and are supportive of our efforts to achieve a sustainable debt structure.”
According to Bedi, the debt restructuring exercise is an important step towards strengthening the company’s business by enhancing liquidity and inducing additional working capital. It is expected to help Tulip Telecom safeguard the interests of its key stakeholders, including customers, employees and vendors.
Bedi adds, “The near term outlook is mixed, considering liquidity constraints and a volatile market environment, despite strong business fundamentals. However, we are confident of leveraging our extremely valuable and state-of-the-art infrastructure and an enviable clientele, over a period of time to post a healthy performance on a sustainable basis.”
