Anil Ambani-led Reliance Communications Ltd (RCom) on Tuesday withdrew its petition challenging an order of the National Company Law Tribunal (NCLT) that allowed insolvency resolution proceedings to be initiated against the company.
The debt-ridden telecom firm has now chosen to go ahead with the resolution process under the Insolvency and Bankruptcy Code.
In May last year, RCom had filed a petition before the National Company Law Appellate Tribunal (NCLAT) against the lower court’s order which was passed on a plea by global telecom gear maker Ericsson over unpaid dues.
The Mumbai bench of the NCLT had on May 15 admitted an insolvency petition filed by Ericsson against RCom and two of its subsidiaries -- Reliance Infratel and Reliance Telecom. The tribunal had also appointed an interim resolution professional to run the company.
The NCLAT stayed the NCLT’s orders a fortnight later.
In February this year, RCom had announced its decision to opt for insolvency proceedings following its failure to execute the sale of assets that would help pay back its lenders.
The following month, the telecom firm had called off agreements for the sale of specified assets to brother Mukesh Ambani-owned Reliance Jio Infocomm Ltd.
Incidentally, Swedish telecom equipment maker Ericsson received Rs 462 crore ($67.42 million) from RCom following an order from the Supreme Court.
Before that, the top court had found chairman Anil Ambani guilty of contempt of court for wilfully defaulting on Ericsson's dues and failure to make repayments.
RCom has been left owing banks $7 billion as of March 2017 when it last made its debt level public, and more to vendors.