Reliance Communications Ltd. today said it has reinstated bank guarantees worth Rs 774 crore with the telecom department, ahead of the timelines set by the telecom tribunal.
The move not only staves off a looming crisis the company had faced after the telecom department's show-cause notice to it on spectrum and licence cancellation, but also clears the way for the asset monetisation plan of the debt-ridden company.
RCom and its subsidiary Reliance Telecom Limited have today reinstated bank guarantees, four weeks ahead of the last date of September 10, 2018 as granted by the Telecom Disputes Settlement and Appellate Tribunal.Reliance Communications' Statement
The reinstatement of the bank guarantees will ensure that the company's licence and spectrum value of Rs 11,300 crore "stands fully protected", the statement said, adding RCom is fully compliant with the stipulated guidelines.
"The company's asset monetisation programme of approximately Rs 25,000 crore for the sale of media convergence nodes, tower, optic fiber and spectrum is fully on track, and will be completed expeditiously," it said.
The first tranche of asset monetisation proceeds had been received last week, the statement said, without divulging details. Reliance Communications had recently received a breather from the telecom tribunal on the licence and spectrum cancellation show-cause notice served by the Telecom Department.
The Anil Ambani-led company had asked the TDSAT to set aside and quash the show-cause notices dated June 19, 2018, and June 22, 2018, and “restrain” the telecom department from terminating or revoking the licences or the spectrum held by the company.
Reliance Communication has entered into an agreement with Mukesh Ambani-owned Reliance Jio Infocomm Ltd. to sell spectrum and other telecom assets for an estimated Rs 17,000 crore, and clear its debt partially. If the Telecom Department had cancelled licences or revoked spectrum of Reliance Communications, the present deal would have been affected.
Reliance Communications is currently under the debt resolution process under the Insolvency and Bankruptcy Code, 2016.
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