China Development Bank plans to withdraw plea against Reliance Communication
, ET Bureau|
Jan 05, 2018, 09.25 AM IST
MUMBAI: China Development Bank (CBD) plans to withdraw its insolvency filing against Reliance Communications (RCom), leaving Swedish equipment maker Ericsson the sole foreign company battling to recover dues from the Anil Ambanicontrolled telco. The hearing in the case is slated for Friday in the National Company Law Tribunal.
"CDB has already received some payment and is happy with the deal it is being offered," said a person familiar with the matter. The Chinese bank, RCom's largest lender, will still have the right to refile this application if the final settlement is delayed, the person said.
It is unlikely that operational creditors — vendors with outstanding payments — and unsecured lenders will receive significant payments, if any at all, another person close to the developments said.
Ericsson, an operational creditor, is aiming to recover Rs 1,150 crore from RCom, while CDB, a secured lender accounting for 37% of RCom's total secured debt, has dues worth Rs 11,460 crore.
"Yes, we will continue with the insolvency petition," Ericsson said in an emailed response to ET's query. RCom and CDB did not respond to ET's queries on the matter. RCom is trying to find solutions to the problems of unsecured lenders and operational creditors, Ambani said at a media briefing late December.
Ericsson told the courts earlier that RCom had not paid it dues for two years and only a few post-dated cheques were given. In September last year, it filed for insolvency in the NCLT to recover the dues from the operator for services and equipment supplied. Negotiations for an out-of-court settlement have failed.
CDB moved the NCLT in November against both RCom and its subsidiary Reliance Telecom for its dues.
But RCom Chairman Ambani said that the telco had reached an out-ofcourt settlement with Chinese lenders, without disclosing details.
ET had reported that CDB and other Chinese lenders were in advanced talks to take up 70% in the development of Dhirubhai Ambani Knowledge City (DAKC).
In an interview to ET, Ambani had said that all lenders were on board RCom's plans to repay a chunk of itsRs 45,000 crore debt by March. The plan envisages selling its wireless assets, including spectrum, towers and fibre, for under Rs 24,000 crore to Reliance Jio, monetising its real estate assets in DAKC to generate Rs 10,000 crore, and divesting stake worth Rs 4,000 crore in the residual RCom, which consists of the global undersea cable business, data centres and enterprise business, to overseas private equity investors.
"CDB has already received some payment and is happy with the deal it is being offered," said a person familiar with the matter. The Chinese bank, RCom's largest lender, will still have the right to refile this application if the final settlement is delayed, the person said.
It is unlikely that operational creditors — vendors with outstanding payments — and unsecured lenders will receive significant payments, if any at all, another person close to the developments said.
Ericsson, an operational creditor, is aiming to recover Rs 1,150 crore from RCom, while CDB, a secured lender accounting for 37% of RCom's total secured debt, has dues worth Rs 11,460 crore.
"Yes, we will continue with the insolvency petition," Ericsson said in an emailed response to ET's query. RCom and CDB did not respond to ET's queries on the matter. RCom is trying to find solutions to the problems of unsecured lenders and operational creditors, Ambani said at a media briefing late December.
Ericsson told the courts earlier that RCom had not paid it dues for two years and only a few post-dated cheques were given. In September last year, it filed for insolvency in the NCLT to recover the dues from the operator for services and equipment supplied. Negotiations for an out-of-court settlement have failed.
CDB moved the NCLT in November against both RCom and its subsidiary Reliance Telecom for its dues.
But RCom Chairman Ambani said that the telco had reached an out-ofcourt settlement with Chinese lenders, without disclosing details.
ET had reported that CDB and other Chinese lenders were in advanced talks to take up 70% in the development of Dhirubhai Ambani Knowledge City (DAKC).
In an interview to ET, Ambani had said that all lenders were on board RCom's plans to repay a chunk of itsRs 45,000 crore debt by March. The plan envisages selling its wireless assets, including spectrum, towers and fibre, for under Rs 24,000 crore to Reliance Jio, monetising its real estate assets in DAKC to generate Rs 10,000 crore, and divesting stake worth Rs 4,000 crore in the residual RCom, which consists of the global undersea cable business, data centres and enterprise business, to overseas private equity investors.
