Three Chinese banks sue Anil Ambani for USD 680 million unpaid loan

Troubles for Indian tycoon Anil Ambani doesn't seem to be ending. Reports have surfaced saying that three Chinese banks are suing Anil Ambani in a London court for failing to pay back USD 680 million in defaulted loans.

According to Bloomberg, the three banks that are suing Anil Ambani are Industrial & Commercial Bank of China Ltd., China Development Bank and the Export-Import Bank of China. In 2012, these three banks agreed to give a loan of USD 925.2 million to Anil Ambani's firm Reliance Communications Limited on a condition that he provide a personal guarantee. Some repayments were made by the wireless carrier but in February 2017, it defaulted on its payment obligations.

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The embattled Indian tycoon says that while he agreed to give a non-binding “personal comfort letter,” he never gave a guarantee tied to his personal assets -- an “extraordinary potential personal liability.” ICBC “failed and continues to fail, to distinguish between Mr. Ambani on the one hand and the company to whom the loans were being extended...on the other,” Ambani’s lawyer Robert Howe said in a court filing, reported Bloomberg.

Anil Ambani was caught up in a similar case earlier this year when India’s Supreme Court threatened him with prison after Reliance Communications failed to pay 5.5 billion rupees to Ericsson AB’s Indian unit. The judges gave him a month to find the funds, and his brother, Mukesh, stepped in to make the payment.

Spokesman for Anil Ambani told Bloomberg, “Mr. Ambani’s position is that the claim made by ICBC in relation to his alleged personal guarantee for loans to RCOM is without merit.” In the meanwhile, the banks in a statement said, “This is a straightforward debt claim to recover outstanding loans made to RCOM in good faith, and secured by a personal guarantee given by Mr. Anil Ambani.”