Four Lenders Seek Stay On Reliance Infratel Committee Of Creditors’ Decisions

Four lenders led by Doha Bank moved the NCLT seeking a stay on decisions of the committee of creditors of Reliance Infratel Ltd. till their petition against dilution of their voting rights is not heard.

Reliance Infratel owes the syndicate of four banks Rs 1,400 crore, giving the banks 55 percent representation in the CoC.

The counsel representing the syndicate argued in front of the Mumbai bench of the National Company Law Tribunal that interim resolution professional of Reliance Infratel had also considered the claims of banks and lenders that had advanced loans to its parent Reliance Communications Ltd.

Reliance Infratel had issued certain guarantees in favour of RCom. After RCom defaulted on its payments, the lenders invoked the bank guarantees issued by Reliance Infratel and converted them into debt.

The counsel argued that if the claims of lenders to RCom are admitted as financial creditors on basis of bank guarantees given by Reliance Infratel, the syndicate’s voting rights in the CoC will fall from 55 percent to 15 percent. The syndicate sought appropriate directions from the NCLT to prevent this.

The counsel also argued that guarantees by Reliance Infratel were in violation of the Companies act, 2013.

The Reliance Infratel CoC’s meeting was scheduled today. The tribunal agreed to hear the matter on an urgent basis on May 31.