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Anil Ambani owned Reliance Communication has entered into binding Memorandum Of Understanding with Veecon Media and Television Limited, for sale of its subsidiary Reliance BIG TV Limited (RBTV), engaged in the business of Direct to Home (DTH) services across India.
Under the transaction, all the existing 1.2 million customers of RBTV shall continue to enjoy uninterrupted services. It also ensures the continuity of employment for approximately 500 employees of RBTV.
"Pursuant to the transaction, Veecon Media will acquire the entire shareholding of RBTV with business on "as-is where-is" basis, along with all existing trade liabilities and contingent liabilities," RCom said.
However, the successful culmination of the transaction is subject to the requisite approvals from licensors, regulatory authorities, and lenders of RCOM.
The existing DTH license of BIG TV shall be renewed with the submission of the required Bank Guarantees with the Ministry of Information and Broadcasting by the buyer, RCOM further said.
The transaction will help reduce the liability of unsecured creditors, benefitting all stakeholders including lenders and shareholders of RCOM, the company added.
The transaction is in consonance with the RCOM's stated objective to focus on B2B businesses of New RCOM.
To recall, this year in October RCom has decided to shut down its DTH arm business Reliance Digital TV with effect from November 18.
The reason behind the decision is the expiry of its DTH license, and the company is not looking to renew it, " RCOM said.
Reliance Digital TV informs its customers that due to the expiry of our license we will be shutting down our DTH services across India wef 18 November. Customers are advised to make alternative arrangements to keep watching their favorite TV channels. We regret the inconvenience caused," Reliance Big TV said in a notice.