Details of resolution plan for Reliance Communications Infrastructure
The National Company Law Tribunal (NCLT) Mumbai on 20 December 2023 gave its approval to a resolution plan submitted by Reliance Projects and Property Management Services Limited for Reliance Communications Infrastructure, a 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.
Here’s the details of the resolution plan submitted by Reliance Projects and Property Management Services:
The successful resolution applicant has proposed a resolution plan of Rs 456 crore against the total admitted claims of Rs 41,397.36 crores. Though Reliance Projects and Property Management Services has claimed that the direct lending to the Corporate Debtor is only Rs 182.20 crores (0.44% of total debt). The balance amounts have been admitted on the basis of corporate guarantees and other similar/ third party obligations of the Corporate Debtor, which claims are also admitted claims in the corporate insolvency resolution process of Reliance Communications Limited, Reliance Telecom Limited, Reliance Infratel Limited.
Of the Rs 456 crore, secured financial creditors who did not vote for the resolution plan receives Rs 317.5 crore against their total claims of Rs 13,277 crore. Secured financial creditors of Reliance Communications Infrastructure receives Rs 138 crore against their total claims of Rs 28,138 crore.
Operational creditors receive a total of Rs 38.37 lakh against their total admitted claims of Rs 272 crore.
The plan provides for a CIRP Costs of Rs 2.85 crore outstanding as on 31 January 2023. It provides for a payment of Rs 11.90 lakh payable to the Workmen and Employees, Rs 26.46 lakh to the Operational Creditors (other than Workmen and Employees).
Payment plan
Of the total resolution amount, Rs 57 crore will be infused by Reliance Projects and Property Management Services. In case that amount falls short of the mandatory payments like CIRP cost, payments to Operational Creditors and Mandatory Dissenting Financial Creditors, etc then the resolution applicant will infuse another Rs 35 crore.
Reliance Communications Infrastructure had extended certain loans to Reliance Bhutan Limited (a wholly owned subsidiary of RITL). As on 31 March 2020, the outstanding amount in relation to such loan is Rs 195 crore. The resolution applicant has agreed to transfer the Reliance Bhutan Loan in favour of the approving financial creditors on the effective date by way of assignment agreement.
The resolution applicant has identified certain real estate assets of Reliance Communications Infrastructure and proposes to monetise them through price discovery mechanism, in order to generate funds within 1 year from the issuance of the Closing Action Notice. It expects to generate an amount of approximately Rs 90 crore.
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