India’s Reliance Communications said on Wednesday it expects to complete its asset sale to Reliance Jio Infocomm and Canada’s Brookfield Asset Management in coming weeks, after the bankruptcy appeals court halted insolvency proceedings against the debt-laden company.
The 181 billion rupee (US$2.68 billion) sale of wireless assets will include airwaves and mobile masts to Jio and Brookfield, as RCom, controlled by businessman Anil Ambani, aims to prune its debt pile.
Brookfield did not immediately respond to a request for comment.
The move follows a settlement with Ericsson for partial payment of dues owed by RCom to the Swedish company. An appeals tribunal in New Delhi on Wednesday put on hold insolvency proceedings against RCom as part of the settlement and asked it to pay Ericsson 5.5 billion rupees (US$81.5 million) by the end of September.
Jio is the telecom venture of Reliance Industries, controlled by India’s richest man Mukesh Ambani.
The National Company Law Appellate Tribunal also asked RCom and Ericsson to file an affidavit by June 7 stating they will abide by the settlement.
RCom had filed an appeal with the NCLAT after the tribunal earlier this month admitted an insolvency plea against the company filed by Ericsson. Ericsson, which signed a seven-year deal in 2014 to operate and manage RCom’s nationwide telecom network, was seeking 11.55 billion rupees from the company and two of its subsidiaries.
On Tuesday, RCom said its unit Reliance Infratel had reached a settlement with its minority shareholders in relation to the sale of its tower and fiber assets.
With debt of 457.33 billion rupees at the end of March 2017, RCom is the most-leveraged listed telecom carrier in India.
Like other established Indian telecom companies, RCom has been hit by a fierce price war over the last year, especially after the entry of Reliance Jio, which offered free voice and cut-price data plans. It shut its mobile operations late last year.
(Reporting by Suhail Hassan Bhat and Nigam Prusty in New Delhi; Writing by Sankalp Phartiyal; Editing by Mark Potter and David Holmes)
(This story has been edited by Kirk Falconer, editor of PE Hub Canada)