Shares of Anil Dhirubhai Ambani Group’s telecom company Reliance Communications (RCom) have doubled the money in just 11 days returning as much as 100% as NCLAT on Wednesday allowed RCom to proceed with the asset sale to Mukesh Ambani-controlled Reliance Jio Infocomm and Brookfield. Further, NCLAT (National Company Law Appellate Tribunal) had stayed the order of NCLT (National Company Law Tribunal) of the insolvency of Reliance Communications (RCom), Reliance Infratel and Reliance Telecom.
Over the course of last one month, an extreme volatility had been seen in RCom shares due to NCLT’s orders, Ericsson’s settlement issue and hindrance in the asset sale to Reliance Jio Infocomm. The stock of Anil Ambani-led Reliance Communications (RCom) has advanced exactly 100% in the last eleven days. RCom shares have jumped 100% to Rs 21 from a share price level of Rs 10.5 as on 16 May 2018. During the stretch of 11 days, heavy trading had been witnessed on the counters of RCom with about 50 to 80 crore equity shares being traded in a single day.
Even today, RCom shares got appreciated by 20% to a day’s high of Rs 21 on NSE while the stock went up by 19.14% to Rs 20.85 on BSE. Massive trading volumes have been observed in RCom shares, as at 10:15 am, more than 19.6 crore equity shares exchanged hands with about 17 crore equity shares on NSE alone.
“RCom’s asset sale to Reliance Jio and Brookfield for an aggregate value of Rs 18,100 crore has been allowed to proceed by the Hon’ble NCLAT. The assets sale includes spectrum, fiber, telecom towers, MCNs and certain real estate assets in Delhi and Chennai,” Reliance Communications said in a statement.
“RCom expects to now complete the sale of its assets within the next few weeks, having removed legal hurdles of cases by minority investors of RITL, and Ericsson, thereby achieving an overall debt reduction of approximately Rs 25,000 crore from the first phase of its asset monetization program, as detailed in the media release issued on 26 December 2017,” RCom said further.
Earlier yesterday, NCLAT put an end to the long-running settlement dispute between Reliance Communications (RCom) and Swedish telecom gear maker Ericsson after RCom and Ericsson agreed to settle the dispute. According to a PTI report, NCLAT has directed RCom to pay Rs 550 crore to Ericsson within 120 days. If RCom fails to pay Rs 550 crore to Ericsson in 120 days, it will direct insolvency proceedings against the company, PTI reported citing NCLAT Chairman Justice S J Mukhopadhaya. The countdown of 120 days would start from 1 June.