Indian telcos, global firms in race to buy RCom stake in Reliance Infratel

Rajesh Kurup Mumbai | Updated on January 09, 2018 Published on November 08, 2017

As many as 11 global and Indian telecom companies have evinced interest to acquire the entire stake held by debt-laden Reliance Communications in its wholly-owned tower subsidiary, Reliance Infratel Ltd (RITL).

The company expects to finalise a buyer by December-end and close the transaction in the first quarter of calendar year 2018.

The investors which are interested in RITL include global private equity majors such as Brookfield Group, The Carlyle Group, TPG Capital, Isquared Capital, Tilman Holdingsand Gateway Partners, sources close to the development said.

Reliance Jio Infocomm, a company controlled by billionaire Mukesh Ambani, is also interested in RITL.

Overseas companies such as Sistema Russia and tower companies such as American Tower Corporation, Bharti Infratel and Indus Towers are other bidders.

“The demand for tower and fibre assets in India is on the rise following the data explosion in the country and as technologies such as 4G and 5G gain ground,” one of the sources said.

RITL’s assets comprise 43,000 towers, largely ground-based towers, and 1.78-lakh route km of fibre.

When contacted an RCom spokesperson declined to comment.

Most of RITL’s towers are designed to provide more than four tenancies (operators on a tower), while about 26 per cent of them are fiberised to support 4G and 5G services. About 45 per cent of its tower portfolio is located in metro and Category A circles.

Of the total 1.78-lakh route km of fibre assets, 18,000 route km is in top 10 cities, including metros, with a potentialcapacity of upto 80 peta bytes. RITL provides fibre connectivity to 1.2 million buildings and 3.5 million households over its fibre network.

Earlier on Tuesday, RCom, which is looking to pare its ₹45,000-crore debt, received bids from a total of 12 investors, including global private equity majors and Indian telecom firms for acquiring a 51 per cent stake in the telecom major.

The bidders included global PE majors such as KKR, The Carlyle Group, TPG Capital, Isquared Capital, Gateway Partners and telecom companies including Telstra Australia, PCCW Hong Kong, Telekom Indonesia and Sistema Russia among others.

RCom was looking at emerging as a strong “New RCom” after its monetisation initiatives were expected to be concluded between December 2017 and March 2018.

The ‘New RCom’ will comprise profitable and growing domestic and international B2B-centric businesses such as data centres, sub-sea cables and enterprise businesses.

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Published on November 08, 2017
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