Debt-laden Reliance Communications today said it will sell its direct-to-home (DTH) subsidiary, Reliance BIG TV, to Veecon Media and Television.
Veecon will "acquire the entire shareholding of RBTV with business on 'as-is where-is' basis, along with all existing trade liabilities and contingent liabilities", Reliance Communications (RCom) said in a statement.
The companies have entered into a binding memorandum of understanding to this effect, it added. As part of the agreement, Veecon will retain nearly 500 employees of RBTV.
"The existing DTH licence of BIG TV shall be renewed with the submission of the required bank guarantees with the Ministry of Information and Broadcasting by the buyer," the statement said.
RBTV's 1.2 million customers will continue to enjoy uninterrupted services, it added. "The transaction will help reduce the liability of unsecured creditors, benefiting all stakeholders, including lenders and shareholders of RCom," it said.
The deal is subject to requisite approvals from licensors, regulatory authorities and lenders of RCom. The transaction is part of RCom's efforts to focus on B2B businesses.
RCom, which plans to shut down voice call service from December 1, has also made a comprehensive debt resolution plan to its domestic and foreign lenders. It had earlier stated that the lenders would convert part of their debt to equity to gain 51% control of the company.
The Anil Ambani-led company will also sell telecom tower and real estate business to pay off Rs 27,000 crore out of Rs 45,000 crore debt on its books, it had stated last month.