New Delhi: Mukesh Ambani-promoted Reliance Jio’s decision to acquire spectrum, tower and other wireless assets of beleaguered Reliance Communications today got a thumbs up from the industry.
On the 85th birth anniversary of father Dhirubhai Ambani, Mukesh Ambani, India’s richest businessman today stepped in to bail out younger brother Anil Ambani’s debt-ridden Reliance Communications by acquiring spectrum, tower, optical fiber network and other wireless assets in a deal that banking sources say is worth Rs 24,000-25,000 crore. The two companies, however, have not disclosed the size of the transaction.
“It is good for the industry because the industry continues to consolidate around serious players who have deep pockets and financial where-with-all to play effectively and delivery value to customers in future,” Mathews said.
The deal can be seen as homecoming-of-sorts for RCom, then Reliance Infocomm, was launched under leadership of Mukesh Ambani in December 2002 with tag line of ‘Kar lo duniya mutthi mein’ to offer cheapest mobile call rates.
However, RIL’s first mobile venture went under the control of Anil Ambani in 2005 as part of settlement deal between the two brothers when they parted ways.
Incidentally, Anil Ambani in September last year had said that Jio and RCom have “virtually” merged. The two companies had signed their first telecom deal in 2013.
The latest deal will bring immediate relief to RCom, which is reeling under Rs 45,000 crore debt, and the company hopes to use the entire proceeds to pare its liabilities.