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In a setback to Reliance Communications’ (RCom) asset monetisation plans, the Supreme Court on Thursday directed the company to maintain status quo on plans to sell its wireless assets to Reliance Jio Infocomm (RJio). The court will now hear the case again on April 5.
In its ruling, the Supreme Court upheld the Mumbai High Court’s decision to halt the sale of assets until the company receives approvals from the National Company Law Tribunal (NCLT). RCoM and its lenders led by State Bank of India had filed Special Leave Petitions (SLPs) in the Supreme Court against the stay granted by two lower courts on the company’s asset sales.
Hearing the SLPs today, the court issued notices to the respondents, Ericsson and minority investors holding about 4 per cent stake in Reliance Infratel. The court has allowed them time till March 28 to file their replies. In view of the intervening court holidays on March 29 and 30, the matter has been fixed for hearing on April 5.
“As legally advised, RCom remains confident that its asset monetisation programme will be completed expeditiously to protect the interests of its secured lenders, much in advance of the time limit of August 31, 2018, prescribed by the RBI for resolution of such cases,” RCom said in a statement.
On Wednesday, debt-laden RCom received approval from the holders of its $300 million bonds, to sell its assets to RJio. The bondholders also approved the telecom company’s plans to monetise its real estate assets.
On December 28, Mukesh Ambani-led RJio had emerged as the white knight to acquire the wireless assets of debt-laden RCom, controlled by his younger sibling, Anil. While the companies did not divulge the financial details, banking sources pegged the deal at about Rs 23,000 crore.
This is one of a series of deals between the brothers – Mukesh and Anil – who had parted ways in 2005, carving the Reliance empire into two.
RJio, a wholly-owned subsidiary of RIL, emerged as the successful bidder in a two-stage bidding process. The company will acquire RCom’s more than 43,000 towers, 1.78-lakh route km of optical fibre cable network, 122.4 MHz of spectrum in the 800, 900, 1800 and 2100 MHz bands and 248 Media Convergence Nodes. These assets are expected to contribute significantly to the large-scale roll-out of RJio’s wireless, fibre-to-home and enterprise services.
The monetisation of RCom’s assets was mandated by its lenders, who appointed SBI Capital Markets to run the process. It was supervised by an independent group of distinguished industry experts.
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