DoT Rejects RCom Spectrum Deal After Jio Refuses To Take Loan Liability

In a major blow to Anil Ambani’s Reliance Communications (RCom), the department of telecommunications (DoT) on Tuesday refused to give a clearance to the proposed RCom-Reliance Jio Infocomm spectrum trade deal. As part of its debt reduction efforts, Anil Ambani-led RCom had in December 2017 signed a Rs 250-billion deal with elder brother Mukesh Ambani’s Reliance Jio. The deal included the sale of assets mortgaged with different banks to avoid insolvency proceedings. The company expected to raise Rs 180 billion from the sale of its wireless assets to RJio and real estate assets to Canada’s Brookfield, and pare some of its Rs 460-billion debt.

Earlier, the apex court had asked RCom to furnish a corporate guarantee of Rs 14 billion within 2 days, following which DoT had to give it a No Objection Certificate (NOC) for the RCom-RJio spectrum sale deal within 7 days. All seemed to be going as planned; RCom furnished the guarantee amount and the DoT agreed to give it the green signal. – Business Standard