How Anil Ambani's Planning To Pay Ericsson After Warning Of Jail Time
Anil Ambani's Reliance Group facing falling group company valuations RCom owes total Rs 571 crore to Swedish telecoms equipment maker Ericsson Reliance Group plans to sell part of its power assets
Business tycoon Anil Ambani is planning to use a payment from his brother's company and the sale of real estate assets to pay what he owes to Sweden's Ericsson following a court ruling this week, a source familiar with the matter said.
The Supreme Court on Wednesday ordered Mr Ambani's Reliance Communications and two of its directors to pay Ericsson Rs 450 crore ($63.30 million) within four weeks or face a three-month jail term for contempt of court.
RCom owes a total Rs 571 crore to the Swedish telecoms equipment maker, including a one-time settlement of Rs 550 crore and interest payments of Rs 21 crore.
The company said in a statement on Thursday it has already deposited Rs 118 crore with the Supreme Court and has sought approval from its lenders to release tax refunds of a further Rs 260 crore to Ericsson.
Since the company is in bankruptcy court for debt resolution, it needs lenders' approval for any such transaction.
"RCom is confident of raising the balance...well within the time of four weeks allowed by the Honourable Supreme Court," the company said in the statement.
A source, who spoke on the condition of anonymity, said RCom is looking to sell its real estate assets in Chennai and Kolkata to raise the remaining funds.
It is also likely to urge Reliance Jio, controlled by Anil's elder brother and Asia's richest man Mukesh Ambani, to speed up payments owed for fibre assets acquired from RCom, the source added.
RCom said in August that it had struck a deal to sell Jio its optical fibre and ancillary telecom assets for Rs 5,000 crore.
"We have received only Rs 780 crore from Jio. We can ask Jio to pay up sooner," the source said.
The court order comes at a time when Anil Ambani's Reliance Group, a diversified business empire, is facing falling valuations of group companies and a loss of goodwill, sparking heavy selling of pledged shares.
Reliance Group said earlier this week that the company plans to sell part of its power assets. On Thursday, it said it would also sell its 42 per cent stake in Reliance Nippon Life Insurance to pay its debtors.
Disclaimer: NDTV has been sued for 10,000 crores by Anil Ambani's Reliance Group for its coverage of the Rafale deal