NCLT allows Mukesh Ambani firm to acquire Reliance Communications Infrastructure
After four years of navigating the insolvency process, Reliance Communications Infrastructure Limited (RCIL) has finally received a lifeline. The National Company Law Tribunal (NCLT) Mumbai today gave its oral approval to a resolution plan submitted by Reliance Projects and Property Management Services Limited. This decision offers a ray of hope for the beleaguered subsidiary of Reliance Communications (RCOM). Reliance Projects and Property Management Services is owned by Mukesh Ambani, the promoter of Reliance Industries. Reliance Communications Infrastructure was earlier owned by Mukesh Ambani’s brother Anil Ambani.
Reliance Communications Infrastructure entered the corporate insolvency resolution process in September 2019 under the Insolvency and Bankruptcy Code (IBC) due to mounting debt. Following a tumultuous period, a resolution plan was accepted by RCIL’s committee of creditors in August 2021. Today’s pronouncement paves the way for the plan’s implementation, bringing much-needed relief to stakeholders.
While the written order is yet to be published, the oral pronouncement signifies a pivotal moment for RCIL. Once the complete order becomes available, further details of the approved plan and its implications will be revealed. This will provide more clarity on the future of RCIL, its employees, and the involved creditors.
This development signifies a crucial step in resolving the long-standing bankruptcy proceedings surrounding Reliance Communication and its subsidiaries. It remains to be seen how the approved plan will impact RCIL’s operations and long-term viability, but for now, a sense of cautious optimism prevails.
Recently, the National Company Law Tribunal (NCLT) has approved the substitution of UV Asset Reconstruction Company Limited (UVARCL) with its affiliate, UV Stressed Asset Management Private Limited (UVSAMPL), as the resolution applicant for Reliance Communications Limited (RCOM), the company said in an exchange filing.
This development comes after the Reserve Bank of India issued new guidelines for ARCs in October 2022, under which UVARCL did not meet certain eligibility criteria. The resolution plan for RCOM, submitted by UVARCL, was approved by the company’s creditors in March 2020 but awaited final approval from the NCLT.
UVARCL filed an application with the NCLT seeking permission to substitute itself with UVSAMPL, and the court granted the application on December 12, 2023.
Reliance Communications, once India’s second-largest telecom company, was dragged to insolvency court in May 2018 by Ericsson India Pvt Ltd for defaulting on a payment of Rs 978 crore.
Also Read: NCLT allows substitution of resolution applicant in Reliance Communications CIRP
