Bad news for Cell C this afternoon as it has announced it has defaulted on a loan of $184 million (R2.69 billion).
The default relates to an interest payment that was due in December 2019. Cell C has also not made capital repayments related to loan facilities between it, Nedbank, China Development Bank Corporation, Development Bank of Southern Africa and the Industrial and Commercial Bank of China.
“Currently, none of the bilateral loan facilities have been accelerated as noteholders are aware and support that Cell C is committed to resolving the situation by agreeing to restructuring terms with its lenders while it also continues to work proactively with all stakeholders to improve its liquidity, debt profile and long-term competitiveness,” Blue Label Telecoms wrote in a statement.
In a statement issued by Cell C, the network operator said that suspension of payments was part of wider initiatives to improve the liquidity of the firm.
“Cell C continues to work proactively with all stakeholders to improve its liquidity, debt profile and long-term competitiveness as part of its turnaround strategy,” Cell C wrote.
“Our turnaround strategy is to ensure operational efficiencies, restructure the balance sheet, implement a revised network strategy and improve overall liquidity. We continue to engage with all stakeholders throughout this process and believe we have made good progress,” added chief executive officer at Cell C, Douglas Craigie Stevenson.
Cell C says that an extended roaming agreement with MTN signed last year helps it control its operating costs and expenditure.
Here’s hoping 2020 is a better year for Cell C though this news doesn’t exactly fill us with confidence.