RIL Comm to merge Infocomm
RIL Communications Ventures, unveiled a restructuring plan aimed at fully owning its operating arms, including Reliance Infocomm.india Updated: Mar 13, 2006 12:33 IST
Reliance Communications Ventures Ltd, a holding firm for Reliance's telecoms business, unveiled a restructuring plan on Sunday aimed at fully owning its operating arms, including Reliance Infocomm.
Reliance Communications Ventures (RCVL), which listed on March 6, was spun off to shareholders of energy conglomerate Reliance Industries Ltd after settlement of a dispute between the Ambani brothers who run the Reliance group.
The company said in a statement that under the previous structure, RCVL had the disadvantage of not owning a majority stake in any of its operating companies.
RCVL holds 45.3 per cent of Reliance Infocomm, 45 percent of Reliance Communications Infrastructure and 35.6 per cent of Reliance Telecom.
The restructuring, which will give RCVL complete ownership of all the operating companies, assets and franchisees, will be through a share swap and will not involve any cash outgo, the statement said.
Reliance Infocomm, India's top CDMA mobile services provider, will be merged with RCVL, while the other companies will be wholly-owned subsidiaries.
RCVL ranks second in terms of mobile customers behind $17.5-billion rival Bharti Tele-Ventures Ltd, India's only other listed telecoms firm with a nationwide footprint.
It is now also the listed flagship of Anil Ambani's Anil Dhirubhai Ambani Enterprises group, which also has interests in utilities, mutual funds, financial services and media.
After a public and very bruising spat last year, the younger Anil took control of RCVL. Elder brother Mukesh controls top petrochemical giant Reliance Industries Ltd.
Reliance Communications has a market share of 19.6 per cent, compared with 22.1 per cent for Bharti in India's mobile telephony market.
After the restructuring, the founders of Reliance Communications will hold 63 per cent stake, foreign portfolio investors and retail investors will hold 14 percent each, domestic institutions will own five per cent and global depositary receipt holders will own four per cent.