Business

Jio, UVARC emerge top bidders for RCom

RCom’s secured debt is estimated at ₹33,000 crore. Lenders had submitted claims of about ₹49,000 crore in August, 2019. Reuters

RCom’s secured debt is estimated at ₹33,000 crore. Lenders had submitted claims of about ₹49,000 crore in August, 2019. Reuters  

Duo agrees to pay ₹7,500 crore, or 30% of the total proceeds, within three months

Reliance Communications (RCom) has received bids of about ₹25,000 crore for its assets, with Reliance Jio placing bids of ₹4,700 crore for its mobile tower and fibre assets, while UV Asset Reconstruction Company (UVARC) has placed bids of around ₹16,000 crore for spectrum, real estate assets as well as the enterprise and data centre businesses.

“The bidders have agreed to pay around ₹7,500 crore, or 30% of the total proceeds, within three months. The Committee of Creditors (CoC) met on Monday. It was decided that the lenders will claw-back priority payments of ₹4,300 crore made to Chinese and Indian lenders,” a source in the know of the development told The Hindu.

RCom’s mobile tower and fibre assets are housed under its subsidiary Reliance Infratel Ltd. (RITL), while spectrum, real estate assets as well as the enterprise and data centre businesses are held in RCom and Reliance Telecom Ltd. (RTL). A Reliance Jio spokesperson declined to offer any comment.

The lenders will start recovering the monetisation proceeds from March 2020. The CoC members will obtain their respective board approvals so that they can put a final vote on the resolution plans on January 31, 2020, ahead of the National Company Law Tribunal (NCLT) filing on February 3, 2020.

With this, 38 lenders of RCom are expected to recover ₹25,000 crore of the total outstanding dues of ₹49,000 crore, making it the highest-ever recovery of dues by financial creditors in the telecom sector, that has seen the exit or shutdown of nine out of 12 telecom companies since 2012.

The company’s secured debt is estimated to be around ₹33,000 crore. Lenders have submitted claims of around ₹49,000 crore in August, 2019.

RCom chairman Anil Ambani had tendered his resignation after the company posted a consolidated loss of ₹30,142 crore for the July-September quarter due to provisioning for liabilities after the Supreme Court ruling on statutory dues.

This was the second-highest loss posted by any Indian corporate till date. However, the CoC rejected Mr. Ambani’s resignation and asked him to cooperate in the insolvency proceedings.

RCom shares on the BSE declined 2.41% to close at ₹0.81 in a firm Mumbai market on Tuesday, valuing the company at ₹224 crore.

A letter from the Editor


Dear reader,

We have been keeping you up-to-date with information on the developments in India and the world that have a bearing on our health and wellbeing, our lives and livelihoods, during these difficult times. To enable wide dissemination of news that is in public interest, we have increased the number of articles that can be read free, and extended free trial periods. However, we have a request for those who can afford to subscribe: please do. As we fight disinformation and misinformation, and keep apace with the happenings, we need to commit greater resources to news gathering operations. We promise to deliver quality journalism that stays away from vested interest and political propaganda.

Support Quality Journalism
Recommended for you
This article is closed for comments.
Please Email the Editor

Printable version | Jun 4, 2020 5:06:05 AM | https://www.thehindu.com/business/jio-uvarc-emerge-top-bidders-for-rcom/article30569436.ece

Next Story