Reliance Communications And Aircel In Talks To Merge Mobile Business

MUMBAI,Dec 22:Ail Ambani-owned Reliance Communications has announced that it is in talks with Aircel to merge their wireless businesses.According to the company's statement, the potential combination will exclude RCom's towers and optical fibre infrastructure, for which the company is proceeding with an asset sale, as announced on December 4, 2015. RCom further said that the discussions are non-binding in nature and there is no certainty that they will lead to any transaction.

The company has entered into a 90-day exclusivity period with Aircel's majority owner Malaysia's Maxis Communications Bhd and another shareholder Sindya Securities and Investments Pvt Ltd, Reliance said in a statement.

Reliance Communications Ltd is India's fourth-biggest mobile phone carrier. The company is already in the process of buying Indian mobile telephony business of Sistema Shyam Teleservices under MTS brand.

According to sources, there will be a separate entity as a result of a potential merger of RCom, MTS and Aircel. RCom's current debt, estimated to be around Rs 10,000 crore, will be transferred to this new entity.

The combination of RCom, Aircel, MTS wireless businesses will hold 19.3% of the total spectrum allocated to the industry -- the highest in the country by an entity.

The new entity, which is in the works, will hold spectrum across all allocated bands -- 800 Mhz, 900 Mhz, 1800 Mhz, 2100 Mhz and 2300 MHz -- for 2G, 3G and 4G services.

Reliance Communications' deal to sell its tower business, when consummated, will substantially improve the telecom major's financial profile, Moody's Investors Service recently said.(TNN)

 

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