NEW DELHI: Shares of Anil Ambani-owned Reliance Communications (RCom) plunged to a record low on Monday. The company, late on Friday, had informed its decision to opt for insolvency proceedings, following its failure to sell assets for paying back lenders.
RCom shares fell as much as 48.27 per cent on BSE to Rs 6 a share intraday, but bounced back to close 34.91 per cent down at Rs 7.55 after a Telecom Disputes Settlement and Appellate Tribunal (TDSAT) verdict fell in its favour.
TDSAT on Monday directed the Department of Telecommunications (DoT) to return RCom’s bank guarantee worth Rs 2,000 crore, which it deposited as per an earlier order passed on July 3, 2018.The impact of the huge sell out of RCom shares was also seen in other Anil Ambani group companies. On BSE (Monday closing), Reliance Capital Ltd declined 19.80 per cent, Reliance Infrastructure Ltd 14.87 per cent, Reliance Power Ltd 35.10 per cent, and Reliance Naval & Engineering Ltd 14.72 per cent.
RCom, which is reeling under a debt of over Rs 46,000 crore, said that lack of regulatory approval for asset sales as well as cases pending at the Supreme Court and TDSAT resulted in its decision to approach the National Company Law Tribunal (NCLT). RCom said it believed that this 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.
The telco had in December 2017 had struck a Rs 25,000-crore spectrum trading acquisition deal with Reliance Jio and had plans to use it for clearing debt of around 40 lenders. However, the deal never got the no-objection certificate from DoT over spectrum related dues.
DoT, to which RCom has pending spectrum dues of around Rs 2,950 crore, had sought a bank guarantee from the company against these dues before allowing it to sell its assets to RJio.
Separately, Swedish firm Ericsson to which RCom owes Rs 1,150 (which later was agreed at Rs 550 crore) moved National Company Law Appellate Tribunal (NCLAT) on Monday to realise its debt.NCLAT agreed to hear Ericsson’s plea against RCom on February 12, while passing an interim order that no asset of the debt-laden company should be sold or transferred without its prior approval.
An RCom spokesperson informed that the company on Monday moved the NCLAT for withdrawal of its appeal in the Ericsson matter, to pursue the resolution plan through NCLT process.