Jio Gets Company Tribunal’s Approval To Acquire Reliance Infratel
Today, Jio received authorisation from the National Company Law Tribunal (NCLT) to purchase Reliance Infratel (RITL).
For the purpose of completing the purchase of RCOM’s tower and fibre assets, the tribunal ordered Jio to deposit 3,720 crore into an escrow account at the State Bank of India (SBI).
Jio has suggested putting $3,720 crore in an escrow account on November 6 in order to complete the purchase of Reliance Infratel, which is going through an insolvency resolution procedure.
In November 2019, the Jio company, founded by billionaire Mukesh Dhirubhai Ambani, made a bid for the tower and fibre assets of the Reliance Communications division, which was in debt.
The Jio resolution plan was already unanimously agreed by the Committee of Creditors on March 4, 2020.
Implementation of the resolution plan is delayed, claims an application made by Jio subsidiary Reliance Projects and Property Management Services, because of the ongoing legal processes over the distribution of the money and issuing of a “no dues” certificate.
It argued before NCLT last month that “Such delay is creating substantial harm to the interest of the corporate debtor (Reliance Infratel) as well as the resolution applicant (Jio).”
According to Jio, the value of the assets may decrease if the acquisition of RITL assets is delayed owing to inter-creditor disputes. 43,540 mobile towers and approximately 1.78 lakh route kilometres of fibre are owned by RITL.
The holding company for RCOM’s tower and fibre assets is called RITL. The victorious resolution applicant for Reliance Infratel Ltd (RITL), Reliance Project & Property Management Services Limited, had filed a new application at the NCLT Mumbai to finish the acquisition procedure.
Once the inter-creditor dispute over the distribution of settlement monies is resolved, the money will be divided among the lenders.
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