Rcom pays ₹460 cr owed to Ericsson

LATE LAST MONTH, ANIL AMBANI WAS FOUND GUILTY OF CONTEMPT OF COURT FOR WILFULLY FAILING TO PAY ERICSSON

BENGALURU: Er i c s s o n h a s received ₹460 crore ($67.42 million) from Indian telecoms firm Reliance Communications Ltd (Rcom), the Swedish company said on Monday, potentially saving billionaire Anil Ambani and two Rcom directors from a jail term.

Late last month, India’s top court found Anil Ambani, chairman of the debt-laden firm, guilty of contempt of court for wilfully failing to pay the Swedish telecom equipment maker.

The court had ordered Ambani and two Reliance Communications directors to pay Ericsson ₹450 crore within four weeks or face a three-month jail term for contempt of court.

Reliance Communications, which owes a total ₹571 crore to Ericsson, including a one-time settlement of ₹550 crore and interest payments of ₹21 crore, had already deposited ₹118 crore with the Supreme Court in February.

The Swedish firm signed a deal in 2014 to manage and operate Reliance Communications’ network and last year approached the court over the unpaid dues.

Reliance Communications has struggled for cash partly a result of a price war triggered by the market entrance of Reliance Jio Infocomm, controlled by Anil’s elder brother and Asia’s richest man, Mukesh Ambani.

Reliance Communications had also sought approval from its lenders to release tax refunds of a further ₹260 crore to Ericsson.

Additionally, the company was also looking at selling its real estate assets to pay Ericsson, people familiar with the matter had told Reuters in February.

Reliance Communications did not immediately respond to Reuters’ request for comment.