Reliance Communications, Ericsson reach settlement on outstanding dues

An Indian appeals tribunal on Wednesday put on hold insolvency proceedings against Reliance Communications (RCom), after the debt-laden Indian telecom carrier reached a settlement with Swedish telecom gear maker Ericsson.

The National Company Law Appellate Tribunal (NCLAT) in New Delhi has asked RCom to pay Ericsson 5.5 billion rupees ($81.52 million) by end-September as part of the settlement.

The settlement potentially paves the way for the Anil Ambani-controlled telecom operator to sell its wireless assets including mobile masts and airwaves to Reliance Jio Infocomm in a deal sources have said is worth $3.8 billion.

RCom had filed and appeal with the NCLAT, after the National Company Law Tribunal, earlier this month, admitted an insolvency plea against the company that was filed by Ericsson.

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Ericsson, which signed a seven-year deal in 2014 to operate and manage RCom`s nationwide telecom network, was seeking 11.55 billion rupees ($171.16 million) from the company and two of its subsidiaries.