Billionaire Mukesh Ambani-run telecom venture Reliance Jio Infocomm has announced that it is considering to raise up to Rs 20,000 crore through debt in tranches. In a stock exchange notice filed yesterday, the company said that the board will meet on March 23rd to consider the fundraising plan. According to the company’s statement the subsidiary of India’s most valued company Reliance Industries is considering to raise funds by way of issuance of listed/unlisted, secured/unsecured, non-convertible debentures for an amount upto Rs 20,000 crore on a private placement basis in tranches/series and also to approve ancillary actions for the said issuance of debentures.
Interestingly, just last week, Jio’s rival Bharti Airtel had said that its board has approved a fundraising plan for a whopping Rs 16,500 crore via private placement of Non-Convertible debentures (NCDs) and foreign currency bonds for refinancing debt and paying off spectrum liabilities. While Jio’s plans are not immediately clear, the company has been investing aggressively to expand its 4G network.
In December-17, Reliance Jio had agreed to buy RCom’s wireless spectrum, media convergence node assets, 43,000 towers, and around 178,000km. The value of the deal is not immediately clear. The company has also been involved in two high profile deals, the latest being acquisition of a 5% stake Eros International, a NYSE (New York Stock Exchange) listed company in February this year.
A joint press release had said that the two companies will invest up to Rs 1,000 crore each to produce and acquire Indian films and digital originals across all languages. Apart from the above planned investment, Chairman of Reliance Industries Mukesh Ambani has also announced an additional investment of Rs 10,000 crore in Uttar Pradesh over the span of next three years. Ambani has also committed that Reliance Jio will invest Rs 5,000 crore in West Bengal over the next three year period.
With over 160 million subscribers and network investments of over Rs 2,00,000 crore, Reliance Jio has been a major disruptor in the already distressed telecom space. Reliance Jio has reported a net profit of Rs 504 crore in just its second quarter of operations as it benefited from the telecom regulator’s decision to halve interconnection usage charges (IUC) effective 1 October and as it added subscribers.