Reliance Communications (RCom) has terminated a deal to sell its telecom assets to Reliance Jio Infocomm after failing to receive regulatory approval.
But RCom's founder Anil Ambani has been granted a last-minute reprieve from being imprisoned for failing to meet the company's court-ordered repayment obligations to major creditor Ericsson after support from his older brother and founder of Reliance Jio Mukesh.
In a stock exchange filing, RCom blamed its decision to terminate its asset sale plan to factors including a failure to receive the required permissions from the Department of Telecom.
RCom also has not received notice of consent or objection from more than 40 of its foreign an Indian lenders regarding the proposed sale, despite holding over 45 meetings over a 15 month period, the company said.
RCom has also decided to attempt fast track resolution of its overall debt through the National Company Law Tribunal, and the Tribunal has restrained the company from selling or transferring ay assets while the case is ongoing.
But due to last minute intervention from Mukesh Ambani, RCom revealed in a second statement that the company has managed to make the required 5.5 billion rupee ($80.1 million) payment to Ericsson before the deadline for him to be jailed.
Ambani was last month found to be in contempt of court over a failure to make the 5.5 billion rupee payment RCom had promised to make to Ericsson in September. He was given four weeks to make the payment or face being jailed for three months.
“My sincere and heartfelt thanks to my respected elder brother, Mukesh, and Nita, for standing by me during these trying times, and demonstrating the importance of staying true to our strong family values by extending this timely support,” Anil Ambani said in a statement.
“I and my family are grateful we have moved beyond the past, and are deeply grateful and touched with this gesture.”
Ambani was referring to the fallout the two brothers had over the inheritance of Reliance Industries from their father Dhirubhai Ambani following his death in 2002. The brothers have since reconciled.
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