More trouble for Anil Ambani as Reliance Communications set to lose undersea cable business

Indian telecom operator Reliance Communications Ltd. will lose control of its undersea cable unit GCX Ltd. after a Delaware Court approved a creditor-supported Chapter 11 plan for the subsidiary, in a setback to its own closely-watched bankruptcy process. The plan that got the nod this week will grant ownership of GCX to its own creditors in exchange for a debt writedown of $150 million, according to a GCX statement and filings. The administrator of Reliance Communications had objected to the plan, arguing that the unit isn’t fundamentally insolvent and that it couldn’t function without its parent, a major client of the firm.

The loss of the unit, which is one of the world’s largest private subsea cable operators and provides fiber optic cable capacity to Reliance Communications’ network,