Closing doors: Reliance Communications shuts down its 2G business
The clock was ticking: after the Aircel merger fell through and RCom's vendors, angry at unpaid dues, stopped honoring agreements, Reliance Communications finally announced that it was closing its 2G wireless business. The company said that its 37 million customers in 3G, 4G and broadband would be moved to its enterprise arm. Once the deal with Aircel fell through, there was little chance of recovery for RCom. Aircel alleged "interventions by vested interests" as part of the reason the merger deal fell through, casting a shadow on company management. The deal had been part of Reliance Communications' effort to reduce its Rs. 45,733 crore debt. Rating agencies had downgraded the company's debt to default levels in May this year, after RCom missed chances for repayments. The company is expected to repay some of its debt through the sale of its spectrum assets, as well as its tower and land assets. In all, this may amount to anywhere between Rs. 25,000 and 30,000 crore. RCom's share price has fallen today on the news.25-10-2017
