Home » , , , , , , , ,

Tikona Digital secures $45 million led by IFC


Share on Facebook0Tweet about this on TwitterShare on LinkedIn1Email this to someone
tikonadigitalnetworkslo

Internet service provider Tikona Digital has raised $45 million investment from the International Finance Corporation (IFC) and existing investors.

Of this, IFC has invested $25 million into Tikona while the remaining $20 million is from existing investors like Goldman Sachs, Oak Investment Partners, Everstone Capital Advisors and L&T Infrastructure Finance Co Ltd. The company plans to use this investment raised to expand its broadband network in existing and new cities, particularly in priority states of Madhya Pradesh, Chhattisgarh, Rajasthan and Uttar Pradesh.

It’s worth noting that Tikona Digital had received FIPB approval to raise Rs 250 crore investment in September this year. The company had then said that it plans to use this investment to increase the foreign equity stake in the company up to 73.76% by issuing compulsorily convertible debentures (CCDs) and/or equity shares to International Finance Corporation and other existing foreign investors. 

Tikona had also received FIPB nod to raise Rs 248 crore investment in January this year, by issuing compulsorily convertible debentures (CCDs) and equity shares to the existing NRI investors to increase the foreign equity stake in the company to 72.58%.

Tikona offers wireless broadband services to home consumers and small enterprises (through the acquisition of HCL Infinet) and is currently operational operational in 25 Indian cities after winding down services in 13 cities in December 2012.

Tikona 4G license: Apart from this, Tikona also owns 20 MHz of 4G spectrum in five telecom circles of Gujarat, UP-East, UP-West, Rajasthan and Himachal Pradesh, for which it had paid Rs 1,058 crore in the 2010 BWA auction.

Advertisement

In December 2012, Tikona CMO Heramb Ranade had mentioned that they plan to launch 4G services in the country by early 2014, however its almost end of 2014 and the company is yet to launch 4G services in the country.  

Note that Tikona has just about seven-eight months before the BWA rollout obligations kicks in. As per these obligations, all BWA licensees should provide street level coverage in at least 90% of the metro service areas and at least 50% of the rural short distance changing areas (SDCAs) by 2015 (five years of the effective date), failing which the BWA spectrum provided will be withdrawn.

Idea Cellular Investment: Interestingly, IFC had also invested Rs 389 crore to pick up up 0.8% stake in Idea Cellular in June this year. This investment was through Idea Cellular’s Rs 3,000 crore qualified institutional placement (QIP) issue.

Share on Facebook0Tweet about this on TwitterShare on LinkedIn1Email this to someone