The country’s largest lender State Bank of India (SBI) has taken Anil Ambani to the bankruptcy tribunal for a personal guarantee given on loans worth over Rs 1,200 crore ($158 million at current exchange rate) to Reliance Communications and Reliance Infratel.
According to people aware of the development, the bank has filed two applications with the National Company Law Tribunal (NCLT) to nominate a professional for the insolvency resolution process of the personal guarantor, Ambani.
A spokesperson for Ambani said, "The matter relates to a corporate loan availed by Reliance Communications and Reliance Infratel and is not a personal loan of Ambani. The two firms’ resolution plans, approved by 100% of their lenders in March 2020, are awaiting the approval of the NCLT.”
"Once the insolvency petition is filed against the personal guarantor, the six-month moratorium will begin and no other creditor can make claims against those assets of the personal guarantor. This is one of the high-profile cases recently filed against the promoters/guarantors of big companies that went to Insolvency and Bankruptcy Code (IBC),” said Ashish Pyasi, Associate Partner at Dhir & Dhir Associates.
Last month, a UK court had ordered Ambani to pay around $717 million (around Rs 5,400 crore) to three Chinese banks in a loan default case.
In March, a creditor panel led by the State Bank of India had okayed the bankruptcy resolution plans of Mukesh Ambani-owned Reliance Digital Platform & Project Services and UV Asset Reconstruction Company for Anil Ambani-owned Reliance Communications and its assets.
Under the resolution plans, the lenders will likely receive 70% or about Rs 23,000 crore of their dues.
Reliance Communications, once a flagship company of the Anil Ambani-led Reliance group, filed for bankruptcy in early 2019.