RIL to divest Jio’s tower assets to Brookfield for ₹25,215 cr
SALE PLAN RIIHL has inked binding agreements with Brookfield and its partners for the tower biz
NEW DELHI: Mukesh Ambani’s Reliance Industries Ltd (RIL) on Monday said it will divest Jio’s telecom tower assets to Canada’s Brookfield Infrastructure Partners LP for ₹25,215 crore.
RIL said its unit, Reliance Industrial Investments and Holdings Ltd has inked binding agreements with Brookfield Infrastructure Partners LP and its partners for the tower business deal.
Brookfield will buyout 100% equity of the operating tower company.
Reliance Industrial Investments and Holdings Ltd “has entered into binding agreements with Brookfield Infrastructure Partners LP, and its institutional partners, for an investment of ₹25,215 crore in the units to be issued by the Tower Infrastructure Trust,” the company said in a statement.
Under t he deal, Reliance Industrial Investments and Holdings Ltd, the sponsor of Tower Infrastructure Trust, would issue units in the trust to Brookfield affiliate BIF IV Jarvis India and some co-investors.
After the deal is closed, the Canadian alternative assets manager, Brookfield and its partners would become sponsors of the trust, holding 100% of India’s largest telecom tower company with 130,000 towers through Tower Infrastructure Trust, while the RIL subsidiary would become a co-sponsor, but will hold no units.
This is the single largest foreign investment in an Indian infrastructure vehicle.
Proceeds from the investment by Brookfield and longterm loans will be used to repay existing financial liabilities of Reliance Jio Infratel Pvt. Ltd ( RJI PL) , including loans extended by RIL.
It owns ₹12,000 crore to Reliance Industries.
“At the closing of the transaction, the Trust will own 100% of the issued and paid-up equity share capital of Reliance Jio lnfratel Pvt. Ltd,” the statement said.
RJIPL has a current portfolio of around 130,000 communication towers that forms the infrastructure backbone of Reliance Jio Infocomm Ltd’s (Jio) telecommunication network and has plans t o expand t his t o 175,000 towers.
Jio is an anchor tenant of the tower portfolio under a 30-year Master Services Agreement.
“We are pleased to enter into this long and strategic relationship with Brookfield, which is one of t he l argest and most respected managers of infrastructure assets globally.
“We are confident of Brookfield’s abilities to manage this large portfolio of high-quality infrastructure assets and further enhancing value creation opportunities. This transaction demonstrates the belief of global investors in the potential of India’s digital opportunity”, said Mukesh D Ambani, chairman and managing director of RIL.
Closing of the transaction is subject to certain regulatory approvals, which are expected shortly, the statement said.