Jio's arm now holds 100% equity share capital of Reliance Infratel: RIL

Reliance Jio's arm Reliance Projects and Property Management Services (RPPMSL) has completed 100 per cent stake acquisition in Reliance Infratel for about Rs 3,720 crore, Reliance Industries Limited said on Thursday.

In a regulatory filing today, RIL stated that Reliance Infratel allotted to RPPMSL 50 lakh equity shares of Rs 10 each, for cash, aggregating Rs 5 crore; and 372 crore zero coupon optionally fully convertible debentures of Rs 10 each, for cash, aggregating to Rs 3,720 crore.

Reliance will acquire Reliance Infratel Limited under the Section 31 of the Insolvency and Bankruptcy Code 
2016 approved resolution plan.

The National Company Law Tribunal (NCLT) gave approval to Jio for the acquisition of Reliance Infratel (RITL) in November.

"The existing paid-up equity share capital of RITL has been cancelled. Upon such cancellation RPPMSL holds 100% equity share capital of RITL," the filing said.

Billionaire Mukesh Dhirubhai Ambani-led Jio placed a bid of Rs 3,720 crore in November 2019 to acquire the tower and fibre asset of debt-ridden subsidiary of his younger brother Anil Ambani-managed firm Reliance Communications.

The tribunal asked Jio to deposit Rs 3,720 crore in the State Bank of India (SBI) escrow account to complete the acquisition of RCom's tower and fibre assets.

On November 6, Jio had proposed to deposit Rs 3,720 crore in an escrow account to complete the acquisition of Reliance Infratel which is undergoing an insolvency resolution process.

The Committee of Creditors has already approved the resolution plan by Jio on March 4, 2020 with a 100 per cent vote. RITL has fibre assets of around 1.78 lakh route kilometers and 43,540 mobile towers across the country.

The funds will be distributed amongst the lenders once the inter-creditor dispute over the distribution of resolution funds is settled.

SBI and a few other banks, including Doha Bank, Standard Chartered Bank, and Emirates Bank, are engaged in a legal battle over the distribution of funds. The matter is pending before the Supreme Court.