Reliance Communications, which is trying to exit from the Indian telecommunications sector after suffering huge losses, has sought more time to pay its dues to Swedish telecom company Ericsson, which has been managing its mobile-phone network in India.
The company, owned by business magnate Anil Ambani, has told the Indian Supreme Court that it cannot pay 5.5 billion rupees (US$76 million) to Ericsson by a December 15 deadline and has blamed the Department of Telecommunications (DoT) for not clearing its spectrum sale to Reliance Jio Infocomm, owned by Anil’s elder brother Mukesh Ambani, The Economic Times reports.
It has pleaded that it be granted two weeks’ time after the DoT clears its spectrum sale and promised to use the proceeds to pay its dues to the Swedish company.
Reliance Communications had earlier missed a September 30 deadline set by the Supreme Court.
Ericsson, however, is not expected to show any leniency and may even revive the contempt-of-court plea it had earlier filed against Anil Ambani, the daily added.
If the Swedish company goes ahead, it would once again raise fears of insolvency for the Indian firm. It is saddled with 460 billion rupees of debt and it badly needs more time to pay off its 39 financial and operational creditors. It is trying to sell off its wireless and real-estate assets to pay its creditors.
Reliance Communications had to close its voice business in November last year because of mounting losses. Anil Ambani later struck a deal with his brother Mukesh and the latter agreed to acquire spectrum, towers, optical-fiber networking and other wireless assets.