RLCM deal to merge its wireless business with Aircel

Vastavam web: Reliance Communications Ltd (RLCM.NS) faced another setback on Sunday after a deal to merge its wireless business with smaller rival Aircel was called off, raising fresh doubts about its debt repayment plans.The company, widely known as RCom, said it had agreed with Aircel to call off the proposed deal due to regulatory delays and legal uncertainties.RCom has been trying to reduce its debt by 250 billion rupees by merging its wireless business with Aircel.
The company has earned a temporary reprieve from its lenders, which have agreed to a standstill on its debt obligations as part of a planned loan restructuring.The collapsed deal raises further doubts about the company’s ability to repay debt, the head of an institutional investor in RCom told Reuters, declining to be identified.
RCom said in a statement it would look to monetize its spectrum through trading and sharing arrangements and continue to implement the monetization of its tower and fiber assets.The company already shares its airwaves with Reliance Jio Infocomm, the network operator backed by Ambani’s older brother and India’s richest man, Mukesh.The collapse of the deal with Aircel comes after the local arm of Sweden’s Ericsson (ERICb.ST) filed a plea with an insolvency court against RCom last month.Ericsson, which signed a seven-year deal in 2014 to operate and manage RCom’s nationwide network, is seeking a total of 11.55 billion rupees from the company and two of its subsidiaries.