CDB, Ericsson’s insolvency petitions against RCom to be heard on Jan 5

MUMBAI: The National Company Law Tribunal adjourned insolvency petitions filed by China Development Bank (CDB) and Ericsson India Pvt Ltd against Reliance Communications Ltd (RCom) and its subsidiaries to January 5 because of a scheduled meeting of the telecom company’s lenders later this month.

China Development Bank filed a case against Reliance Telecom Ltd on November 24.

The Anil Ambani-led telecom firm owes around $2 billion to Chinese lenders including CDB. Ericsson, an operational creditor of RCom, has also filed winding up petitions against RCom and two of its subsidiaries — Reliance Telecom and Reliance Infratel Ltd. RCom and its subsidiaries together owe ₹1,154 crore to the Swedish network services provider.

While the counsel for Ericsson wanted the hearing to take place on Monday, RCom’s counsel argued that since the “hearing of the case filed by financial creditors (CDB)” has been rolled over to January 5, the hearing pertaining to the case filed by Ericsson should be postponed to the same day.

In a December 16 report, Business Standard had reported that RCom and CDB had approached the NCLT in Mumbai for an adjournment of the latter’s insolvency petition till next month as they have begun negotiations for an out-of-court settlement.

An RCom spokesperson declined to comment.

A lawyer representing the joint lending forum of Indian creditors to RCom was present as well. He said that the JLF will be meeting towards end of December and sought a rollover of the hearing as well.

On November 30, RCom had stated in a stock exchange filing that its lenders have decided to oppose CDB’s insolvency petition against the firm.

“The lenders also decided to appoint J. Sagar Associates as their legal counsel to oppose the said China Development Bank petition at the admission stage itself,” the notification stated.

RCom’s total debt was ₹44,345 crore at the end of fiscal 2016-17. The firm had expected to cut its debt by 60%.

Its lenders led by the State Bank of India had invoked strategic debt restructuring (SDR) against the firm in June, allowing them to convert debt into equity.

RCom had received a breather from the lenders till December 2018 to complete sales of some assets and pare its debt.