Reliance ADAG Chairman Anil Ambani has announced plans to file for an initial public offering for its tower subsidiary Reliance Infratel, the exact time frame is not known. In February 2008, he first announced plans to file for an IPO (Red Herring Prospectus available here) but it was put on hold due to the economic slowdown, according to Business Line. Now, Reliance ADAG is readying the new prospectus to submit to Securities Exchange Board of India (SEBI). Infratel will offer 10% of its equity to investors upon the IPO. RCOM shareholders will continue to own 85% of Reliance Infratel following its IPO, Ambani said at the company's annual general meeting, where he also spoke the performance of Infratel, RCOM and the outlook. Excerpts from Ambani's speech: The De-merger & Consolidation Of OFC Our decision to demerge was guided by the need to keep ourselves asset-light, improve our return on equity and create value for our shareholders. In July 2007, we divested 5 per cent of Reliance Infratel for about Rs. 1,400 crore, generating capital gains of over Rs 1,200 crore for you, our shareowners. This deal attributed an equity value of about Rs. 27,000 crore to the company, amounting to Rs. 135 for every share of Reliance Communications. The recent transfer of optic fiber assets to our subsidiary, Reliance Infratel, has brought our entire passive infrastructure portfolio under one entity, enabling an efficient organizational structure from both customer acquisition and organizational cost perspectives. (Reliance Communications shareholders approved the demerger of…
