InvestorQ : How will the sale of Jio tower assets impact Reliance Industries?
Arya Nanda made post

How will the sale of Jio tower assets impact Reliance Industries?

Deepa Salunkhe answered.
2 years ago

The Competition Commission of India (CCI) approved the divestment of Reliance Jio Infocomm Ltd’s telecom tower assets to Canada’s Brookfield Infrastructure Partners and a set of other investors. This comes more than a month after RIL signed a binding pact with Brookfield of Canada for an investment of Rs.25,215 crore in its tower arm. This syncs with the overall objective of RIL to reduce debt in its high-capex telecom business and increase focus on building digital services. The partners of Brookfield are British Columbia Investment Management, Anahera Investments and Valkyrie Investments. Jio will now be the anchor tenant of the tower portfolio under a 30-year master services agreement.

The CCI approval gives a head start to Reliance at a time when its two competitors; Bharti Airtel and Vodafone Idea, await government clearance for the merger of Indus Towers and Bharti Infratel. This investment by Brookfield marks the single largest foreign investment in an Indian infrastructure vehicle. Earlier, tower and fibre infrastructure assets of about Rs.125,000 crore were demerged from Reliance Jio in March 2019 and transferred into InvITs. Reliance Jio lnfratel has 130,000 communication towers in its portfolio, which it plans to grow to 175,000. This will help RIL in its goal of moving towards debt free status over the next few years.