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RCom Insolvency: Lenders To Meet On Monday, May Consider Reliance Jio, UVARC Bids

While UVARC is said to have offered Rs 14,700 crore for RCom and Reliance Telecom, Jio bid Rs 4,700 crore for Reliance Infratel.

A man exits a Reliance Mobile Store, operated by Reliance Communications Ltd., in the Malviya Nagar area of New Delhi, India. (Photographer: Prashanth Vishwanathan/Bloomberg)
A man exits a Reliance Mobile Store, operated by Reliance Communications Ltd., in the Malviya Nagar area of New Delhi, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

Insolvent firm Reliance Communications Ltd. on Sunday said a meeting of its lenders is scheduled to be held on Monday, but no other details were disclosed.

"The 18th meeting of the committee of creditors of Reliance Communications Ltd. is scheduled to be convened on Monday, Feb. 24, 2020," RCom said in a regulatory filing.

According to sources, the CoC will on Monday put to vote bids received from UV Asset Reconstruction Co. Ltd. and Reliance Jio Infocomm Ltd. to recover around Rs 23,000 crore from Anil Ambani’s insolvent company.

UV Asset Reconstruction Co. Ltd. is learnt to have placed a bid of around Rs 14,700 crore, while Reliance Jio has made an offer of Rs 4,700 crore for tower and fibre assets of Reliance Infratel Ltd. There will also be a clawback of Rs 4,300 crore of priority payments made to Chinese and Indian creditors.

Reliance Jio placed bid for tower and fibre assets of Reliance Infratel and UVARC for assets of RCom and Reliance Telecom.

RCom's secured debt is estimated to be around Rs 33,000 crore. Lenders submitted claims of around Rs 49,000 crore in August.

The Reliance Group company has put all of its assets on sale, including 122 MHz of spectrum, its tower business, optical fibre network and data centres.

According to an order by the National Company Law Tribunal, the CoC had to complete the RCom insolvency process by Jan. 10 but it sought extension in deadline. The resolution professional, Deloitte, is expected to file resolution plan with the NCLT Mumbai on March 5.

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RCom had in the past tried to sell assets to various companies, including Reliance Jio, to clear debt but the deals did not materialise. Reliance Jio cancelled agreement to buy RCom assets, including spectrum, as it did not want to bear the past liabilities of the debt-ridden firm.

Later, insolvency proceedings against RCom started on a plea filed by Swedish telecom gear maker Ericsson SA after the company failed to clear its dues.