Shareholders continue legal scrap over RCOM asset sale

10 Apr 2018

Minority shareholders in Reliance Communications’ (RCOM’s) tower company Reliance Infratel have moved the Supreme Court against the National Company Law Appellate Tribunal’s (NCLAT’s) recent decision which permitted the cellco to sell its tower assets. The Economic Times writes that HSBC Daisy Investments, amongst others – holding a combined total of around 4% of Infratel – challenged the decision on the grounds that their consent had not been sought for the asset sale and that the transaction would lead to the towerco becoming defunct: a move that they claim would be ‘an oppression of a minority shareholder under section 397 an 398 [of the Companies Act, 1956]’. As previously reported by TeleGeography’s CommsUpdate, RCOM’s planned asset sale was derailed by creditors and shareholders concerned that it would leave them unable to recoup their funds. Whilst the Supreme Court greenlit the sale of spectrum and real estate assets, it said that the disposal of fibre and tower assets would be resolved by the NCLAT. The NCLAT went on to approve the sale, with the condition that the proceeds be held in escrow until a decision could be reached on how to distribute the funds.

India, Reliance Communications (RCOM)