Tata Communications, formerly VSNL, today said it has dropped the option of rights issue as of now and will incur a capex of 400-500 million dollar in 2009-10 but has no cash crunch.
The company said it has raised adequate debt and had strong cash on hand.
"The company has dropped the rights issue option as of now...It is not on the agenda. We have raised 350 million dollar long term debt including bonds. Our capex in the current fiscal is 400-500 million dollar, and looking at the trend, it will be the same in 2009-10," Corporate Strategy Senior Vice President Srinivasa Addepalli told reporters.
The company had earlier approached its major stakeholders -- the government and Tata Sons -- for a Rs 1,000 crore rights issue besides raising additional debt.
DoT was understood to be not in favour of the rights issue, as it would reduce government's stake in the company.
The capex for 2009-10 is excluding the upcoming WiMax auction, Addepalli said adding the company had no liquidity crunch, as it had raised 350 million dollars of debt and had 300 million cash on its books.
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"There is no liquidity crunch in the company...We have raised debt of 350 million dollar. Banks and lenders have showed keenness to fund our debt, if any," he said.
Shares of the company closed at Rs 412.30 on the BSE, up 1.65 per cent.