SC paves way for RCom’s asset sale to Reliance Jio

The Supreme Court on Friday cleared a settlement between Reliance Communications Ltd (RCom) and the Indian unit of the Swedish telecom equipment maker Ericsson AB, paving the way for the sale of the telecom operator’s assets to Reliance Jio Infocomm Ltd.

The judgment, which was delivered by a two-judge bench headed by justice RF Nariman, directed Reliance Communications to pay ₹550 crore to Ericsson by October 1 and asked RCom chairman Anil Ambani to give an undertaking to this effect.

The apex court will now hear RCom’s plea to close the insolvency case on October 1.

Meanwhile, Ericsson has objected to the settlement terms of RCom’s insolvency case, news agency Bloomberg reported.

Ericsson had in 2014 signed a seven-year deal with RCom to operate and manage its nationwide telecom network. The Indian-arm of the Swedish company has alleged that it has not been paid over ₹1,000 crore.

The Indian-arm of the Swedish company had earlier claimed outstanding dues to the tune of ₹1,600 crore, but had agreed to settle for ₹550 crore later on.

With the settlement, RCom is now expected to complete asset sales pegged at about ₹25,000 crore to Reliance Jio in the next three weeks. The asset sale to Reliance Jio will help reduce the lenders exposure to RCom by 50%, said a RCom spokesperson. RCom owes about ₹42,000 crore to lenders.

In December 2017, as a part of its debt resolution plan, RCom struck a ₹25,000 crore deal with the Mukesh Ambani-led Reliance Jio for the sale of its assets mortgaged with different banks, to avoid insolvency proceedings.

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