MUMBAI: The Competition Commission of India (CCI) has cleared the proposals for the sale of assets of Reliance Communications Ltd (RCom) to Reliance Jio Infocomm Ltd.
"@CCI_India approves acquisition of RCOM's towers, optic fiber cable, right to use spectrum and media convergence nodes by RJIO," the anti-trust regulator tweeted.
The proposals cleared include RCom’s towers, India fibre, spectrum holdings and media convergence nodes. While neither Jio nor RCom had divulged the size of the deal, sources have pegged the transaction value at Rs 18,000 crore.
The deal appears to be a win-win for both brothers as Jio gets most of RCom’s assets, giving it more firepower in its telecom business, while the Anil Ambani-promoted firm will reduce its debt overhang substantially.
Anil Ambani on 26 December, 2017 said his company had agreed to a new debt resolution plan that will see RCom sell its assets—spectrum, fibre, telecom towers and real estate other than Dhirubhai Ambani Knowledge City—and did not entail lenders and bond-holders writing off dues or converting it into equity.
Through this process, he hoped to cut RCom’s debt by Rs 39,000 crore from the Rs 45,000 crore it owed lenders at the end of October.
According to the terms of the deal, Jio will buy RCom’s assets which include 122.4 MHz of 4G spectrum in the 800/900/1,800/2,100 MHz bands, over 43,000 towers, 178,000 RKM (route km) of fibre with a pan-India footprint and 248 media convergence nodes covering five million square feet, used for hosting telecom infrastructure. At the time of the deal announcement, the companies had also said that the transaction is likely to be completed in a phased manner by March 2018.
RCom is also left with around 134 MHz of spectrum assets for which it is understood to have found other bidders.
However, an arbitration panel in an interim order recently, restrained RCom from asset sale or transfer, without its “specific permission.”
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