Info-tech

RIL to buy controlling stakes in wired broadband cos DEN, Hathway for ₹5,230 cr

Our Bureau Mumbai | Updated on October 17, 2018 Published on October 17, 2018

hathway

Deal gives JioGigaFiber access to 50 million homes across 1,100 cities and towns

Reliance Industries Ltd (RIL) is to acquire a controlling stake in DEN Networks and Hathway Cable for ₹5,230 crore, gaining access to 25 million homes for its wired broadband services.

RIL will pick up a 66 per cent stake in DEN through a primary investment of ₹2,045 crore via a preferential issue and secondary purchase of shares for ₹245 crore from the existing promoters. In Hathway, it will invest ₹2,940 crore through a preferential issue for a 51.3 per cent stake.

Hathway said it will issue 90.8 crore shares to Reliance at ₹32.35 apiece. RIL will also make open offers for DEN and Hathway as required under SEBI takeover regulations. An open offer will also be made for GTPL Hathway Ltd.

“After having taken India to the top position in the mobile broadband space, Reliance is now committed to take India from a global rank of 135th to among the top three countries in the world on wireline digital connectivity,” RIL said in a press release.

Over the past 25 years, India has connected about 175 million homes with basic coaxial cable technology. However, the local cable operators (LCOs) have been steadily losing market share because of increasing competition from alternative technologies such as direct-to-home (DTH). In fact, DTH operators have weaned away over 60 million homes from cable operators, who have remained basic TV service providers.

Immediate access

“Through this transaction, Reliance and Jio will strengthen the 27,000 LCOs that are aligned with DEN and Hathway and enable them to participate in the digital transformation of India through access to superior back-end infrastructure; tie-ups with content producers; access to latest business platforms to improve business efficiencies and deliver customer experience; and investment in digital infrastructure for connecting customers,” RIL said.

This is part of the Reliance gameplan to bring JioGigaFiber to more than 50 million homes across 1,100 Indian cities and towns in the shortest possible time.

Reliance said it will work with Hathway, DEN and all the LCOs to offer a quick and affordable upgrade to JioGigaFiber and Jio Smart-Home Solutions to the 24 million existing cable connected homes of these companies across 750 cities.

Mukesh Ambani, Chairman and Managing Director of RIL, commented: “This will result in growing wireline data connectivity in India and making state-of-the-art high-speed affordable internet and digital services accessible to the widest population in the shortest possible time.”

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Published on October 17, 2018
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