RPG Cables completes financial recast

RPG Cables has completed its financial restructuring with the infusion of Rs 151 crore through a combination of debt and equity by Deutsche Bank AG Hong Kong and the promoters RPG Group.

As per the restructuring package, existing lenders have agreed for a one-time settlement, which would result in the reduction of borrowings by over Rs 100 crore and cut the interest burden by Rs 12 crore every year.

Deutsche Bank AG has been allotted fully convertible debentures aggregating Rs 28 crore, which will translate to approximately 14.9% of the company's equity capital. In addition, Deutsche Bank AG has provided working capital facilities to RPG Cables to enable the company grow its business.

A sick company, RPG Cables had a net loss of Rs. 39.54 crore for 2005-06.

Nikhil Gupta, managing director, RPG Cables said: "Backed by the thrust on the power sector development, the power cables industry is at present witnessing a strong growth momentum. The completion of financial restructuring would enable RPG Cables to meet the growing demand for its products. RPG Cables is also set to grow by better capacity utilisation and improved operational efficiencies."

The company has shown growth in revenue and order inflows in FY07. During the first three quarters, sales rose 53% to Rs 152 crore as against Rs 99 crore during the same period last year.