NCLT approves Jio’s Rs 3,720-crore bid for Reliance Infratel
Mukesh Ambani-owned Reliance Jio has acquired brother Anil Ambani’s Reliance Infratel Ltd through its associate company Reliance Digital Platform & Project Services Limited for a sum of Rs 3,720 crore.
Reliance Infratel was under insolvency proceeding initiated by operational creditor Ericcson India in May 2018. The Mumbai bench of the National Company Law Tribunal (NCLT) approved the resolution application of Reliance Digital Platform & Project Services on 3 December 2020.
As per the resolution plan, the resolution applicant will make an upfront payment of Rs 3,720 crore for Reliance Infratel. It will make an additional payment of Rs 800 crore to the financial creditors through the value realised from the preference shares in Reliance Realty Limited, a subsidiaries of Reliance Communications.
Reliance Bhutan Limited (RBL), a wholly owned subsidiary of the Corporate Debtor, holds preference shares Reliance Realty Limited (RRL), which holds certain real estate assets.
In case, RRL is able to sell its real estate assets for an amount of Rs 800 Crore or more, the the resolution applicant will realized that amount (less any taxes and transaction costs) from the value realised from the preference shares held by RBL in RRL to be distributed to the approving financial creditors on a pro rata basis.
As per the plan, financial creditors would receive Rs 4236 crore, 10.3% of their total admitted claims of Rs 41,055 crore.
Operational creditors (other than dues of government and employees) would receive Rs 25 crore, or 20% of 129 crore. The resolution plan provides for Rs 4 crore towards payment of statutory dues (taxes, and other government dues) against the total claims of Rs 31 crore.
No sum was provided in the plan for dues amounting to Rs 270 crore towards related parties.
Out of the total admitted claims, Rs 904 crore belongs to the affiliates of the Resolution Applicant – Reliance Jio Infocom Ltd (RJIL) and Jio Digital Fibre Private Ltd (JDFPL). Both these companies have agreed to waive their rights towards any payments under this plan.
Apart from the overall payment proposed under the Plan, an amount of up to INR 250 crore has been waived by RJIL towards CIRP Cost incurred by it for the maintenance and preservation of value of Corporate Debtor.
