In a rule favouring Reliance Communications (RCom) Chairman Anil Ambani, the UK High Court dismissed summary judgement applications filed by clutch of Chinese banks claiming $680 million. The Chinese banks – China Development Bank, Mumbai branch of Industrial and Commercial Bank of China and Exim Bank of China – had demanded the amount in lieu of corporate loans provided to Reliance Communications (Rcom). The order was issued on Monday, while the hearing had happened on November 7.
"For all the reasons given above, I consider that Ambani's evidence is inexplicably incomplete, implausible and highly unlikely... I think it is highly probable that at trial his defence will be shown to be opportunistic and false," read a UK High Court order dated November 7, 2019. “Anil Ambani is pleased with the dismissal of the summary judgment application filed by the Chinese banks before the UK High Court,” a spokesperson for Ambani said. “Ambani's position that the claim made by Chinese banks in relation to his alleged guarantee for corporate loans availed by RCom could not be granted by way of a summary judgement has been duly upheld by the UK High Court,” he said. The banks had provided total loans of $925.2 million to RCom in 2012 on a condition that Ambani provide personal guarantees. While RCom repaid certain amount, the telecom operator began defaulting on payments from February 2017.
The Chinese banks in a joint statement said: “We welcome the grant of a conditional order against Anil Ambani as we have always said his defence is not credible. This is a straightforward debt claim to recover outstanding loans made to RCom in good faith and secured by a binding personal guarantee given by Mr. Ambani. We now look forward to the swift resolution of the case at trial.” RCom Chairman, who had contested the proceedings stating there were no “personal guarantees”, will continue to contest the proceedings, he added. In 2018, RJio entered into an agreement with RCom to buy its assets that included 43,000 telecom towers and 1.78-lakh route km fibre and use spectrum, a deal that failed to go through.
In December 2017, Mukesh Ambani emerged as the white knight and announced the acquisition of the debt-laden RCom through RJio, a wholly-owned subsidiary of Reliance Industries (RIL). Later, in March this year, RCom and RIL mutually called off that deal, citing lack of regulatory approvals.
