China Development Bank (CDB) withdrew a bankruptcy petition against troubled Indian operator Reliance Communications (RCom), although Ericsson vowed to press on with similar proceedings.
The Economic Times reported CDB is satisfied with the deal being offered by RCom and had already received a payment on its debt, leaving Ericsson the only company pressing ahead with insolvency action.
CDB started proceedings in November 2017 in a bid to recover the INR114.6 billion ($1.8 billion) it was reported to be owed from RCom and subsidiary Reliance Telecoms. Its move followed Ericsson, which filed its own INR11.56 billion petition against the company in September.
The troubled operator is in the process of raising funds to reduce debt and reportedly agreed to sell INR240 billion worth of spectrum, tower, fibre optic and other telecoms infrastructure to Reliance Jio in December – though it was unclear how much will be paid for the assets.
CDB said it retained the right to restart proceedings with the National Company Law Tribunal in India if it fails to recover the funds owed.
The reprieve will be welcome news in what had been a turbulent 12 months for RCom.
In October a proposed merger with fellow operator Aircel fell through after 22 months of negotiations and wrangling with regulators, amid a background of increasingly fierce competition and rising debt.
Financial Times reported in December the company had finally reached an agreement with lenders on how it would deal with its INR444 billion debt pile. Its resolution included selling most of its telecoms assets and land in Mumbai, in addition to quitting the retail business and focusing on small B2B customers.