RCom’s proposed asset sale to Reliance Jio could face trouble as the National Company Law Tribunal (NCLT) on Tuesday admitted Ericsson’s plea against the Anil Ambani-led firm.
The Swedish telecom gear maker had filed an insolvency petition against RCom in September last year as a payment of Rs 1150 crore is pending from the telecom operator. The Ericsson case pertains to the Swedish firm’s managed services contract with RCom to support its nationwide network for a period of 7 years. The Swedish firm claimed that the project demanded the firm to employ 5000 employees.
Ericsson had argued in the court that despite multiple assurance by the Anil Ambani-led firm to make the payment, it was never paid and the firm had no option but to approach the authority.
Ericsson has done this as a last resort in order to resolve an issue regarding debt that Reliance owes to Ericsson for services provided under a contract,” the company said.
This is the second time in little over a year time that RCom’s plan to raise money and bring down debt is thwarted. The earlier case pertains to its merger with Aircel which could not materialize because of mounting legal cases.
A statement from RCom in late Tuesday evening said the firm is yet to receive the detailed order.
“Reliance Communications Limited and two of its subsidiaries Reliance Telecom Limited and Reliance Infratel Limited, await the detailed orders of the Hon’ble National Company Law Tribunal (NCLT), Mumbai, allowing the Ericsson application for admitting the companies to debt resolution under IBC,” RCom said in a statement. “The Companies will decide the next course of action after studying the orders.”
The unpaid dues from RCom, Reliance Infratel and Reliance Telecom remained at Rs 491.41 crore, Rs 534.75 crore and Rs 129.34 crore respectively, totalling Rs 1150 crore.
The telecom operator is in the process of selling its telecom towers, fiber network, nodes and servers and spectrum to Jio for around Rs 18,000 crore.
Admission of the insolvency petition means RCom can’t sell anything now till the case is solved.