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Reliance Communications is likely to close its merger with Sistema Shyam TeleServices Ltd (SSTL) this week, as the company expects to get the Department of Telecommunications’ (DoT) approval in a day or two. A formal announcement is also expected soon, if not this week.
RCom is expecting the DoT, the country’s telecom licensor, to clear the deal this week itself.
The approval is expected as the company had paid ₹400 crore to the DoT last week, which includes a ₹390-crore bank guarantee and ₹10-crore spectrum payment, sources close to the development said.
When contacted, an RCom spokesperson declined to comment.
‘Sweet deal’“This is the sweetest deal for RCom,” one of the sources said.
They, however, declined to be identified before a formal announcement.
In November 2015, Russia’s public diversified holding company Sistema had announced plans to merge its Indian telecom subsidiary SSTL with RCom.
Following the deal, RCom will get validity of its spectrum across eight circles — Delhi, Gujarat, Kolkata, Karnataka, Tamil Nadu and Kerala — extended till financial year 2033. RCom’s spectrum in these circles were to expire in 2021.
After the deal, RCom, controlled by billionaire Anil Ambani, will issue a 10 per cent stake to SSTL in an all-stock deal.
RCom’s 10 per cent will be valued at about ₹650 crore and the 850 MHz spectrum in eight circles at ₹7,500 crore, another source said.
At present, SSTL has ₹1,000 crore in revenues, 5 million customers and a profit of ₹700 crore.
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