Investors holding $300 million worth of bonds in Reliance Communications (RCom) gave the India-based operator a green light to sell assets to Reliance Jio, the troubled operator announced.
The move is part of a strategy to cut RCom’s debt load. The bondholders’ approval comes after shareholders in February cleared a plan to to sell the operator’s spectrum, towers and fibre telecoms infrastructure.
In a statement RCom said bondholders “approved with overwhelming majority” the sale of the infrastructure assets along with “monetisation of other real estate assets”. Bondholders “also approved release of their security on the company’s assets and to accept part prepayment of their outstanding bonds,” it added.
The bonds were issued in May 2015 at 6.5 per cent interest and were due to mature in 2020.
The asset sale will see RCom’s telecoms operations brought back into the fold of Reliance Industries after the business was split in 2005.
An arbitration court ruled RCom must seek permission before transferring or disposing of any assets following an interim order imposed during the litigation with Ericsson.