Telecom service provider Aircel has filed for bankruptcy protection
with the National Company Law Tribunal (NCLT) in Mumbai, after its
Malaysian promoter Maxis Communications decided against pumping
additional funds into the company.
Aircel was weighing various options, including venturing into 4G services through partnerships, but this entailed fresh fresh investments from promoters.
However, Aircel said that in a statement that filing of CIRP is not a proceeding for liquidation, rather is a process to find best possible resolution for the current situation.
The move follows a Joint Lenders’ Forum meeting held in Mumbai Wednesday Feb 28,2018, wherein the lenders sought moving NCLT for bankruptcy protection.
In a statement in New Delhi, Aircel said that intense competition following the disruptive entry of a new player, legal and regulatory challenges, high level of unsustainable debt and increased losses had together caused significant “negative business and reputational impact” on the company
“The Board of Directors of the Corporate Debtor today announced that they have filed an application under Section 10 of the Insolvency and Bankruptcy Code 2016 for undertaking Corporate Insolvency Resolution Process(CIRP) for the respective companies: Aircel Cellular, Dishnet Wireless, Aircel Ltd,” the statement said.
Led by State Bank of India, the lenders, including China Development Bank, Bank of Baroda, Canara Bank and Punjab National Bank, had earlier stated that Aircel will have to cease operations in case shareholders decline to infuse funds.
Maxis holds a 74 per cent stake in the company, while the remaining 26 per cent is held by Sindya Securities & Investments.
Aircel was weighing various options, including venturing into 4G services through partnerships, but this entailed fresh fresh investments from promoters.
However, Aircel said that in a statement that filing of CIRP is not a proceeding for liquidation, rather is a process to find best possible resolution for the current situation.
The move follows a Joint Lenders’ Forum meeting held in Mumbai Wednesday Feb 28,2018, wherein the lenders sought moving NCLT for bankruptcy protection.
In a statement in New Delhi, Aircel said that intense competition following the disruptive entry of a new player, legal and regulatory challenges, high level of unsustainable debt and increased losses had together caused significant “negative business and reputational impact” on the company
“The Board of Directors of the Corporate Debtor today announced that they have filed an application under Section 10 of the Insolvency and Bankruptcy Code 2016 for undertaking Corporate Insolvency Resolution Process(CIRP) for the respective companies: Aircel Cellular, Dishnet Wireless, Aircel Ltd,” the statement said.
Led by State Bank of India, the lenders, including China Development Bank, Bank of Baroda, Canara Bank and Punjab National Bank, had earlier stated that Aircel will have to cease operations in case shareholders decline to infuse funds.
Maxis holds a 74 per cent stake in the company, while the remaining 26 per cent is held by Sindya Securities & Investments.
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