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RJio Gets $1.5 Bn Loan, To Hire 3,000 For 4G Growth

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Reliance Jio Infocomm (RJIL), the telecom subsidiary of Reliance Industries Limited (RIL), on Monday said that it has borrowed $ 1.5 bn to pursue expansion.
 
"The facility is guaranteed by Reliance Industries Limited (RIL) and will be used to refinance the syndicated term loan facilities aggregating to US$1.5 Billion tied up by RJIL in 2010," the company said in a statement. 
 
The $1 bn worth of debt have to be repaid within 5.5-years while the remaining has a maturity of 7-years, the Mukesh Ambani-led company said.
 
Middle Eastern, regional Taiwanese and Japanese banks strongly participated in providing facility, it said.
 
"The overall bank group saw participation from banks all over the world, including North America, Europe, Australia, Asia and the Middle East. This term loan syndication saw a total of 26 banks participate in the facility," the statement said.
 
The tranche with 7-year maturity period represents the longest average maturity for an unsecured loan of similar size in Asia this year, the company claimed.
 
Reliance is flexing its muscles for the 4G play which is expected to be launched in India soon. As of now RJIL would be the only player in the country that would be offering this service (4G). 
 
The company is expected to hire around 3,000 people for its 4G play. The 4G services would be launched anytime around March 2015. The company has invested anywhere around Rs 70,000 crore (around $11.31 bn) in its 4G play including Rs 24,000 crore (around 3.88 bn) in buying airwaves. 
 
"RJIL holds spectrum in1800 MHz (across 14 circles) and 2300 MHz (across 22 circles) capable of offering fourth generation (4G) wireless services. RJIL plans to provide seamless 4G services using FDD-LTE on 1800 MHz and TDD-LTE on 2300 MHz through an integrated ecosystem," the company said. 
 
Currently the country is seeing a healthy growth in the phone connections but the revenues of the telecom companies are under duress. Even the 3G services launched by many service providers in most circles have failed to bring in the kind of revenues expected by the service providers. It would be interesting to see how the service providers price their 2G and 3G services in a scenario when 4G ones are launched.