The National Company Law Tribunal’s Mumbai bench has given approval to Reliance Jio’s resolution plan for the Anil Ambani-owned Reliance Infratel. Following this, lenders of Reliance Infratel may get around ₹4400 crores for the bankrupt company’s infrastructure such as tower and fibre assets.
Notably, Reliance Infratel, which has over 40,000 towers and 1,72,000 route kilometres fiber, is a fully-owned subsidiary of Reliance Communications. The resolution plan was approved by all the members of the Committee of Creditors, sources said.
Worth mentioning here is that the distribution of proceeds under the resolution is subject to Doha Bank intervention application’s disposal.
As per the plan approved by lenders, RCom and its subsidiary Reliance Telecom will go to UV Asset Reconstruction Company Ltd (UVARCL) whereas the tower unit will go to Jio. Sources close to the development said the total consideration under this resolution plan of ₹20,000-22,000 crore will be paid over a 7-year period.
LIC, China Development Bank, SBI, Exim Bank of China and Bank of Baroda are among the creditors to the bankrupt telecom company.
It must be mentioned here that RCom was forced to shut its wireless operations three years ago due to mounting debt and widening losses amid intense competition in the telecom sector after Jio’s entry in 2016. It attempted to sell its wireless assets, including spectrum and towers, to Jio, but didn’t succeed owing to a slew of legal cases.
As a result, the telco and its units opted for insolvency proceedings, which was admitted under the IBC in May 2019.