Reliance Jio to acquire Anil Ambani-led RCom's wireless assets

Reliance Jio to acquire Anil Ambani-led RCom's wireless assets

The deal involves RCom selling its telecom towers, spectrum, optic fibre network and media convergence nodes to the unit of energy conglomerate Reliance Industries Ltd, the companies said in separate statements.

Mukesh Ambani's Reliance Jio announced a deal on Thursday to acquire younger brother Anil Ambani-owned Reliance Communications's (RCom's) wireless infrastructure assets, including towers and spectrum, at an estimated price of Rs 20,000-24,000 crore. 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 Reliance Jio.

The chairman said that the debt resolution will see RCom in leaving the SDR framework with no conversion of debt into equity and zero write-off by lenders and also said that he further expects full closure by March 2018. "Timing could be questionable: I mean, Jio does not need spectrum right now - they have enough for at least the next two years - but they must be thinking long term".

The announcement comes just two days after RCom - promoted by Anil Ambani - disclosed a new deal with the lenders under which almost Rs 40,000 crore will be raised through sale of assets, averting an imminent takeover by the 35 local and foreign banks.

The proceeds of the sale will primarily be used to reduce Reliance Communications' debt, according to moneycontrol and other reports. Reliance Communications is promoted by Anil Ambani.

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Until now, barring Jio, nearly every other player in the telecom sector has been in talks with other players to join hands.

India Ratings and Research says the industry is being redrawn from a large number of operators to an oligopoly as sponsors of smaller, unprofitable telcos exit the field, unable to sustain losses.

Jio said the deal would help the company expand its telecom business.

The deal comes just two days after RCom entered into a new deal with the lenders, where Rs 40,000 crore will be raised through sale of assets, thereby avoiding a potential takeover by 35 local and foreign banks. "The company will utilise the proceeds of the monetisation of this cash deal exclusively for pre-payment of debt to its lenders", it said. The monetisation process of assets will be mandated by SBI Capital Markets Limited.

Mukesh Ambani-led Reliance Jio Infocomm (RJI), the telecommunications arm of.