NEW DELHI : The National Company Law Tribunal (NCLT) upheld Doha Bank’s petition requesting priority payment for the financial creditors of Reliance Infratel, which will lead to approximately ??3,515 crore in clawback for lenders, according to a source familiar with the development.
Payment should be made from a payment of approximately ??4,400 crore made from the sale of assets to a subsidiary of Reliance Industries Ltd (RIL) through a debt resolution process led by NCLT.
According to the source, the State Bank of India will receive ??728 crore, Mahima Mercantile ??514 crore, SC Lowy ??511 crore, VTB Capital PLC ??511 crore, Doha Bank 409 crore, Emirates NBD ??322 crores, ICBC ??278 crore and Standard Chartered Bank will get ??242 crores.
“Reliance Infratel will also obtain ??455 crore towards the capital and working capital requirements of the subsidiary RIL. The rest of the amount will be distributed among operational creditors, employees, etc. The source said.
NCLT, Mumbai had approved Reliance Infratel’s resolution plan on December 3, 2020 in favor of a subsidiary of RIL – Reliance Projects and Property Management Services Ltd.
The tribunal also noted that the distribution of the proceeds to financial creditors was subject to the settlement of Doha Bank’s claim.
Reliance Infratel had issued certain guarantees in favor of the lenders Reliance Communications (RCom) and Reliance Telecom Ltd (RTL), but the lenders of these two companies invoked guarantees in the event of default and converted them into debt.
Doha Bank’s contention was that the direct lenders of Reliance Infratel had a primary interest in the proceeds of the company’s resolution plan, and not the corporate guarantee holders of RCom and RTL.
In its Tuesday order, NCLT upheld Doha Bank’s plea, paving the way for 100% recovery for Reliance Infratel’s financial creditors, and the implementation of the resolution plan is expected to be completed by the 31st. March 2021, the source said.
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