Anil Ambani-owned Reliance Communication has decided to implement a debt resolution plan through the National Company Law Tribunal (NCLT) framework as it seeks to pare down its debt of Rs 42,000 crore. In a filing with the stock exchanges on Friday, the board of the company reviewed the progress of the its debt resolution plans since it invoked Strategic Debt Restructuring on June 7, 2017 and noted that lenders have received zero proceeds from the proposed asset monetization plans.
However, the overall debt resolution process is yet to make any headway. And the main reason the board of the company decided to go for NCLT resolution is that a 100% approval of all 40 lenders has been impossible to achieve on any matter for over 12 months and over 45 meetings. It is mandated as mandated by RBI’s February 12, 2018 circular that there should be a 100% approval and consensus from shareholders to take the SDR scheme forward.
Moreover, Reliance Communication’s Rs 18,000-crore asset-sale plan has not seen any progress due to the pendency of numerous legal issues at high courts, TDSAT and Supreme Court, legal challenges by DOT for spectrum monetization.
Accordingly, the Board has now decided that the company will seek fast track resolution through NCLT, Mumbai. Reliance Communication said in a statement that the Board believes this course of action will be in the best interests of all stakeholders, ensuring comprehensive debt resolution in a final, transparent and time bound manner within the prescribed 270 days.
RCOM and only two of its subsidiaries, Reliance Telecom Ltd. and Reliance Infratel Ltd., will take appropriate steps shortly to implement the Board decision. Reliance Communication also added that there will be no impact on the business and operations of other subsidiaries of the Company, including inter alia GCX, Reliance IDC, etc.