Reliance Communications moves Bombay HC against arbitration court order barring sale of assets
, ET Bureau|
Updated: Mar 07, 2018, 12.35 PM IST
Reliance Communications (Rcom) has moved the Bombay High Court against an arbitration order passed a day before that had "restrained” the telco from selling or transferring its assets without its permission.
"The company has filed an appeal before the Hon'ble Bombay High Court to protect the interest of the secured lenders," said the telecom company in a statement to the stock exchanges late Tuesday evening.
The arbitration court's interim order which would hold till the next date of hearing on June 9 was a blow to the Anil Ambani-owned telco’s efforts to pare debt by March end under a plan driven by its lenders. Therefore the Ambani owned telco which is in the midst of selling most of its wireless assets to Mukesh Ambani owned Reliance Jio Infocomm (Jio) was forced to hasten its appeal to the higher courts.
The interim order came in an arbitration battle being fought between Ericsson and RCom with the Swedish equipment maker trying to recover its dues worth Rs 1,012 crore.
ET learnt that on Tuesday, Ericsson too filed a caveat in the Bombay High Court to ensure that its views are heard before the court takes a call.
As things stand, the arbitration court ruling stalls the company’s planned sale of most of its wireless assets including spectrum, tower, fibre and media convergence nodes to Jio for over Rs20,000 crore, which was scheduled to be completed by March end.
The funds thus raised would be used to repay RCom’s 35 lenders. But in case RCom can’t repay by end of March, the lenders could take the company to the National Company Law Tribunal (NCLT) under the Insolvency & Bankruptcy Code, 2016, especially after the central bank scrapped all debt recasts.
"The company has filed an appeal before the Hon'ble Bombay High Court to protect the interest of the secured lenders," said the telecom company in a statement to the stock exchanges late Tuesday evening.
The arbitration court's interim order which would hold till the next date of hearing on June 9 was a blow to the Anil Ambani-owned telco’s efforts to pare debt by March end under a plan driven by its lenders. Therefore the Ambani owned telco which is in the midst of selling most of its wireless assets to Mukesh Ambani owned Reliance Jio Infocomm (Jio) was forced to hasten its appeal to the higher courts.
The interim order came in an arbitration battle being fought between Ericsson and RCom with the Swedish equipment maker trying to recover its dues worth Rs 1,012 crore.
ET learnt that on Tuesday, Ericsson too filed a caveat in the Bombay High Court to ensure that its views are heard before the court takes a call.
As things stand, the arbitration court ruling stalls the company’s planned sale of most of its wireless assets including spectrum, tower, fibre and media convergence nodes to Jio for over Rs20,000 crore, which was scheduled to be completed by March end.
The funds thus raised would be used to repay RCom’s 35 lenders. But in case RCom can’t repay by end of March, the lenders could take the company to the National Company Law Tribunal (NCLT) under the Insolvency & Bankruptcy Code, 2016, especially after the central bank scrapped all debt recasts.
