REUTERS - Shares in Reliance Communications
The postponement marks another failure in the company's various attempts to reduce its debt burden of $7 billion.
A planned sale of its telecoms tower unit, expected to raise about $3 billion, has dragged on for almost two years, while an earlier plan to sell a stake of up to 26 percent in the parent itself found no takers.
"There is no immediate debt reduction move in sight for them," said K.K. Mital, a portfolio manager at Globe Capital in New Delhi.
"The entire telecoms sector is under pressure because of policy issues and the impact on Reliance Communications is even more because of their high debt," Mital said.
Reliance Communications, controlled by billionaire Anil Ambani, was looking to raise between $700 million and $1 billion through the listing of its undersea cable assets as a business trust in Singapore.
It said it would await supportive market conditions to proceed with the offering at an appropriate time in the future.
The company, which posted a surprise profit rise in the March quarter after 10 straight quarters of profit decline, repaid convertible foreign bonds by borrowing $1.2 billion from Chinese lenders.
By 0435 GMT, shares in Reliance Communications, valued at $2.3 billion, were down 3.4 percent at 61.60 rupees in a Mumbai market down 0.9 percent. The stock is down 12 percent this year and trading at less than a tenth of its peak in 2008.
The Singapore trust was offering a dividend yield of as much as 11.5 percent, higher than that offered by peers, but even that did not attract enough investor interest. The institutional bookbuilding for the IPO was extended twice last week, before the company said it was putting the offer on hold.
