Home Business Reliance JIO all set to buy Rcom’s wireless assets

Reliance JIO all set to buy Rcom’s wireless assets

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(G.N.S) Dt. 29
New Delhi/ Mumbai
Reliance Jio led by billionaire Mukesh Ambani will acquire mobile business assets of his younger brother Anil Ambani-owned Reliance Communications (RCom). The proposed transaction is subject to lenders’ and other applicable approvals and is expected to close in phased manner between January and March 2018. Both the parties are bound by confidentiality obligations and will make further disclosures at the appropriate time.
After the transactions, RCom is expected to gain from the sale, the proceeds of which will be used for the company’s debt reduction. Anil Ambani-led telecom major will be selling its assets like 122.4 MHz of 4G spectrum in the 800/900/1800/2100 MHz bands, over 43,000 towers, amongst the top 3 independent tower holdings in India, approximately 1,78,000 RKM of fibre with pan India footprint, 248 media convergence nodes, covering 5 million sqft used for hosting telecom infrastructure etc.
“Reliance Jio Infocomm Limited (RJIL), a subsidiary of Reliance Industries Limited, announced signing of definitive agreement for the acquisition of specified assets of Reliance Communications Limited and its affiliates,” Reliance Jio said in a statement on Thursday. The deal is slated to bring relief to RCom which is reeling under huge debt of around Rs 45,000 crore.
“Consequent to the agreement, Jio or its nominees will acquire assets under four categories — towers, optic fiber cable network, spectrum and media convergence nodes — from RCom and its affiliates,” the statement said, adding that these assets are strategic in nature and are expected to contribute significantly to the large scale roll-out of wireless and fiber to home and enterprise services by RJIL. As far as the proposed transactions are concerned, RJIL is being advised by Goldman Sachs, Citigroup Global Markets, JM Financial Private Limited, Davis Polk & Wardwell LLP, Cyril Amarchand Mangaldas, Khaitan & Co and Ernst & Young. Reliance Jio or its nominees will buy Rcom’s assets under 4 specific categories which will contribute significantly to the large scale roll-out of wireless and fiber-to-home and enterprise services. “These assets are strategic in nature and are expected to contribute significantly to the large scale roll-out of wireless and fiber-to-home and enterprise services by RJIL,” the statement said.
“The acquisition is subject to receipt of requisite approvals from governmental and regulatory authorities, consents from all lenders, release of all encumbrances on the said assets and other conditions precedent. The consideration is payable at completion and is subject to adjustments as specified in the agreement,” it said. Reliance Jio said process to acquire assets of RCom is supervised by an independent group of distinguished industry experts and it emerged as the successful bidder in the two- stage bidding process. “An asset monetisation process for RCom assets was mandated by the lenders of RCOM, who appointed SBI Capital Markets Limited to run the process,” the statement added.

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