Advertisement

  • News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
  • Editorial Calendar 19-20
BW Businessworld

Reliance Communications To Sell 51% Telecom Tower Stake To Brookfield for Rs 11,000 Crore

Reliance Communications will use the proceeds of the deal with Brookfield 'solely' to repay debt, it said a statement

Photo Credit :

1476431970_HbO9p9_Reliance_Telecom_Reu.jpg

Reliance Communications is selling a 51 per cent stake in its tower assets to Canada's Brookfield Infrastructure Group for Rs 11,000 crore ($1.65 billion), in a deal that will help cut the phone carrier's huge debt.

Reliance Communications will use the proceeds of the deal with Brookfield "solely" to repay debt, it said a statement on Friday (14 October). The preliminary deal is subject to definitive documentation, regulatory approvals and other terms and conditions.

Controlled by billionaire Anil Ambani, Reliance Communications is the most leveraged among listed Indian phone carriers with its $6.3 billion net debt being more than five times its operating profit. Ambani said last month the company aimed to cut its debt by more than three-quarters within a year.

Reliance Communications, India's fourth-biggest cellular carrier by customers, is also merging its wireless business with smaller rival Aircel and has said that deal will cut its debt by Rs 20,000 crore as it transfers part of the debt to the new venture.

India is the world's second-biggest and the fastest-growing internet market by users.

As Indian mobile phone carriers expand their 4G telecom networks to cater to fast-rising demand for high-speed data, Reliance Communications and Brookfield expect the tower business' revenue and profitability to improve further, according to the statement.

Reliance Communications, which has been trying to sell the tower assets for years, had in December signed a non-binding pact with a group led by buyout firm TPG Capital Management LP. That deal did not go through.

Shares in Reliance Communications were trading 2.3 per cent higher by 0819 GMT in a Mumbai market that was up 0.3 per cent.

(Reuters)


Tags assigned to this article:
reliance communictions anil ambani telecom Brookfield