NEW DELHI: Reliance Communications (RCom), India’s fourth-largest telecom operator by user base, will sell 51% stake in its tower business to Canada’s Brookfield Infrastructure Group for Rs 11,000 crore, in a deal that will help the Anil Ambani-led firm reduce its debt pile of Rs 42,000 crore .
RCom has signed a non-binding term sheet with Brookfield, it said in a statement . Sources close to the company said RCom will retain 49% stake in the tower business, and will look at a complete exit in the future.
It would also get “49% future economic upside” from the tower business based on conditions, and is expecting considerable value creation in the next couple of years due to the growth of 4G networks, the statement added.
Besides the Brookfield deal, RCom is looking to net Rs 14,000 crore from the proposed merger of its airwaves business with Aircel. Another Rs 8,000 crore will be garnered from hiving off its Indian fibre assets and land monetisation drives. So ultimately, RCom is likely to be left with Rs 9,000-crore debt on its books.
“We have 49% stake with us in the tower business, which we will sell at a later stage. So the remaining debt will also be made good,” said a company executive who did not wish to be named.
{{/usCountry}}“We have 49% stake with us in the tower business, which we will sell at a later stage. So the remaining debt will also be made good,” said a company executive who did not wish to be named.
{{/usCountry}}The Reliance Group has been looking to sell it tower business for sometime now. The move will also help reduce the Group’s consolidated debt, which currently stands at around Rs 108,000 crore.
Brookfield Asset Management has lined up $2 billion for investing in Indian assets.
The company is reportedly looking at several highway projects owned by NHAI, office spaces owned by the Hiranandani Group in Mumbai and road assets owned by Reliance Infrastructure.