Anil Ambani debt fix is now even beyond big brother Mukesh's reachRcom is in the process of selling its tower and optic fibre assets housed under Reliance Infratel - to Jio for Rs 8000 crore, of which Rs 5,000 crore would be for the towers and land alone.
Anil Ambani's debt distress is now beyond even billionaire bro's helpAccording to lawyers present in the court room, the court dismissed all three appeals filed by Reliance Communications and its two companies.
Large buys and sells in Reliance Communications indicate some players holding large numbers of shares in the company have been selling and buying back largely the same numbers of shares in an effort to earn some remaining profit, as the price of RCom stock continues to decline. These include the firms Shaastra Securities, Purity Trademax, as well as Adroit Share and Stock Broker. None of these firms have publicly available shareholding data.
While RCom's share price is currently above where it was in December (when prices hovered in the Rs. 11 - Rs. 15 range), share price for the company has stagnated, as it has come under regulatory criticism for failing to pay back the remaining money from its subscribers, and also failing to disclose details of its deal with Reliance Jio. Neither RCom nor Reliance Jio have disclosed the valuation of the deal involving Jio's purchase of RCom's wireless assets. As some would say - it's all in the family.
Minority shareholder HSBC Daisy Investments (Mauritius) approached the National Company Law Tribunal seeking redress, on details of RCom's deal with Mukesh Ambani's company. Reliance Infratel, RCom's telecom tower arm, has finally agreed to disclose deal details, on condition that these details cannot be made public to other shareholders.
Reliance Communications, in a press meet in December, had announced a shift in its business model after its consumer telecom business collapsed under bankruptcy and circling lenders. The company's share price began to recover as Anil Ambani said that the "new" B2B focused company will be based on a capex-light model and will generate sustainable cash flows.
However, this new Reliance Communications is already the target of TRAI's ire. The regulator has pulled up RCom for "trying to pocket the unspent pre-paid balances and security deposits of its mobile subscribers". TRAI issued a notice in January asking RCom to refund the unused balance of the telco's prepaid customers, and the security deposit of the post-paid subscribers by January 31.
RCom responded by asking the regulator to withdraw its directive and cited mobile number portability (MNP) rules to say that it is not required to give the money back. These rules however, don't apply to a company closing down. TRAI estimates that by failing to refund customers, the firm is adding approximately Rs. 150 crore to its own coffers.