Elder brother Mukesh Ambani is going to take over Anil Ambani's debt-ridden Reliance Communications, reported PTI. Reliance Jio will be acquiring its wireless spectrum, tower, optical fiber network and Media Convergence Node (MCN) assets.
The news comes two days after RCom disclosed a new deal with the lenders under which nearly Rs. 40,000 crore will be raised through the sale of assets, averting an imminent takeover by the 35 local and foreign banks.
The size deal between the two companies has not been disclosed due to confidentiality obligations, but the banking sources have estimated the transaction to be valued at Rs. 24,000 - 25,000 crore; which Reliance Communications' is hoping to use entirely to reduce its Rs. 45,000 crore debt and bring immediate relief.
In a statement, Reliance Jio Infocomm Limited (RJio) said these assets are strategic in nature and are expected to contribute significantly to its large scale roll out of Wireless and Fiber-to-Home and Enterprise services. Jio has attained over 160 million subscribers in a span of a little over a year into 4g operations.RCom said the deal packs in 122.4 MHz of 4G Spectrum in the 800/900/1800/2100 MHz bands, over 43,000 towers, 1,78,000 kilometers of fiber and 248 media convergence nodes.
The said transaction is expected to be completed in a phased manner between January and March 2018 after approval from lenders and other authorities.
"The RJio deal consideration comprises primarily of cash payment and includes a transfer of deferred spectrum installments payable to the Department of Telecommunication (DoT). The company will utilize the proceeds of the monetization of this cash deal solely for pre-payment of debt to its lenders," RCom said, as per PTI.
Reliance Jio will acquire all the assets without any previous liabilities attached to them.