New Delhi: State Bank of India (SBI), the lead lender to the Anil Ambani-owned Reliance Communications (RCom), has reached out to top four audit firms and consultants to recognise and pick a resolution professional (RP) to manage the telecom company's insolvency proceedings. Ernst & Young and an RP previously appointed by RCom are said to be among the firms considered by SBI, which accounts for more than a fifth of India's banking assets, sources said.
The state-run lender is thinking about initiating an independent application to take the telecom company to the National Company Law Tribunal (NCLT), even though the debt-ridden company, because of its inability to pay its debts, had earlier this month informed stock exchanges that it opted to submit itself to NCLT.
SBI also has the choice to wait for the Ambani-owned company to initiate bankruptcy proceedings on its own, following which it can suggest an RP of its own choosing once the committee of creditors is convened, sources said. RCom owes banks about Rs 40,000 crore.
"It is a policy of the bank not to comment upon individual accounts and its treatment," said an SBI spokesperson.
In May last year, Swedish telecom equipment maker Ericsson took RCom to NCLT as the telecom firm had not paid Rs 550 crore it owed for equipment supplies. The tribunal had allowed for the appointment of consulting firm RBSA as the RCom's RP and its subsidiaries Reliance Infratel and Reliance Telecom.