wordpress blog stats
Connect with us

Hi, what are you looking for?

Reliance Jio signs deal to buy RCom’s wireless assets

While we were away…

The Mukesh Ambani-led Reliance Jio announced it will buy the wireless infrastructure assets that include towers, optic fibre cable network, spectrum, and media convergence nodes (MCNs)* of Reliance Communications (RCom) and its affiliates in an all-cash deal. The debt-ridden RCom is owned and run by the younger Ambani sibling, Anil.

In an acquisition transaction related to one listed company buying another, it’s strange that no acquisition price has been publicly disclosed to shareholders. Transparency, anyone? However, The Economic Times says, not naming any sources, that the deal is pegged at Rs 24,000 crores.

A press statement from RCom mentions that after the purchase Jio will gain over 178,000 kilometres of optic fiber, more than 43,000 cellphone towers and 122.4 MHz of 4G Spectrum in the 800/900/1800/2100 MHz bands.

The newly acquired assets are “strategic in nature and expected to contribute significantly to the large-scale rollout of wireless and fibre-to-home services by the company,” the statement from Reliance Jio said.

Advertisement. Scroll to continue reading.

What about subscribers

According to data released by TRAI in October 2017, Reliance Jio had more than 120 million active subscribers and the number for RCom was over 46 million.

But on October 31st a directive from TRAI said that RCom “shall provide only 4G data services to its customers and as a result will discontinue to provide voice services to the subscribers, with effect from December 1, 2017.” The regulator had directed RCom to not reject any porting out request of its subscribers and asked all telecom operators to accept request of RCom subscribers till December 31, 2017.

This would suggest that Reliance Jio will not be adding the entire 46 million large subscriber base to its network.

What is being said about the deal

  • A report on the Economic Times speculates that this deal could be the first step by the Ambani brothers towards consolidation of their father’s business. It goes on to point out that the timing of the deal was set to happen on the birth anniversary of Dhirubhai Ambani.
  • In a statement to BloombergQuint Prashant Singhal of the consultancy firm EY India said that if the deal in the Rs25,000 crore ballpark it’ll help RCom cut down a lot of its debts and not require any write-offs from lenders.
  • But global financial services major Morgan Stanley mentioned that the deal may raise Jio’s parent company RIL’s net debt 10-12% in the near term.

*Note: We are not sure what a Media Convergence Node is and we have reached out to RCom for a comment. We will update the story when we hear from them.

Advertisement. Scroll to continue reading.
Written By

Writes about consumer technology, social media, digital services and tech policy. Is a gadget freak, gamer and Star Wars nerd.

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

Views

News

When news that Walmart would soon accept cryptocurrency turned out to be fake, it also became a teachable moment.

News

The DSCI's guidelines are patient-centric and act as a data privacy roadmap for healthcare service providers.

News

In this excerpt from the book, the authors focus on personal data and autocracies. One in particular – Russia.  Autocracies always prioritize information control...

News

By Jai Vipra, Senior Resident Fellow at Vidhi Centre for Legal Policy The use of new technology, including facial recognition technology (FRT) by police...

News

By Stella Joseph, Prakhil Mishra, and Yash Desai The Government of India circulated proposed amendments to the Consumer Protection (E-Commerce) Rules, 2020 (“E-Commerce Rules”) which...

You May Also Like

News

Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...

News

By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...

Advert

135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...

News

Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Name:*
Your email address:*
*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ