Mukesh Ambani bails brother out of jail trouble by paying dues

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It had threatened to send the billionaire as well as Chhaya Virani and Satish Seth - chairmen of two RCom units, to jail if they fail to pay the dues in four weeks.

Anil, whose businesses in telecom and power sectors went into heavy debt in the face of regulatory headwinds and intense competition, thanked Mukesh and his wife Nita for bailing him out.

The SC bench, comprising Justices R F Nariman and Vineet Saran, said the three Reliance companies failed to adhere to the 120 days deadline and 60 days extra given by the apex court to pay the required amount to Ericsson.

Late last month, India's top court found Anil Ambani, chairman of the debt-laden firm, guilty of contempt of court for wilfully failing to pay the Swedish telecom equipment maker.

The case moved from the National Company Law Tribunal (NCLT) to the National Company Law Appellate Tribunal (NCLAT) and then to the Supreme Court, which gave RCom two deadlines-September 30 and December 15, 2018 -to repay dues, both of which were missed by RCom.

The judges warned that Ambani would be jailed for three months if 4.5 billion Indian rupees were not stumped up within a month.

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The payment made on Monday is expected to bring curtains down on the bitter and protracted face-off between Reliance Communications and Ericsson over the outstanding dues.

Shares of Reliance Communications fell by nearly 10 per cent on India's Bombay Stock Exchange at the close of markets on Monday, just the latest sharp dip.

The threat of a prison term to Ambani also came as a rare warning to some of India's richest borrowers whose firms have turned defaulters. The nation's policymakers and courts have been cracking down hard on delinquency to help banks saddled with the world's worst bad-loan ratio.

RCom had also sought approval from its lenders to release tax refunds of a further 2.6 billion rupees to Ericsson.

The Ambani brothers used to serve as executives at their father's company. Following their father's passing in 2002, the siblings got into a high-profile dispute over control of the sprawling conglomerate. Bloomberg-compiled data show his current net worth is about US$300 million, compared with at least $31 billion in 2008, based on the current foreign exchange rate.

Reliance Communications (RCom) has terminated its asset sale plan with Reliance Jio Infocomm (Jio), blaming lack of consent from its lenders and permissions from telecom department for the deal fall out among other reasons. His nationwide 4G network, which debuted with free services in 2016, has disrupted the industry, forcing rivals including RCom to bleed, merge or exit the business.

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