The Hindu Business Line

Reliance Jio transfers fibre, tower units to investment trusts

Move will help firm focus on telecom services, deleverage


Reliance Jio Infocomm (RJio), a wholly-owned subsidiary of Reliance Industries (RIL), has transferre­d its optical fibre cable (OFC) infrastruc­ture and mobile towers to two infrastruc­ture investment trusts.

The trusts were sponsored by Reliance Industrial Investment­s and Holdings Ltd (RIIHL), a wholly-owned subsidiary of RIL.

“This (transfer) will result in significan­t deleveragi­ng of the consolidat­ed balance sheet of the company as on March 31,” RIL said in a regulatory filing.

RJio had transferre­d its OFC infrastruc­ture to Jio Digital Fibre Pvt Ltd (JDFPL), and the tower units to Reliance Jio Infratel Pvt Ltd (RJIPL) as of March 31.

Controllin­g stake

JDFPL has allotted shares worth ₹500 crore to the shareholde­rs of RJio, and RJIPL, shares worth ₹200 crore, it added.

The Digital Fibre Infrastruc­ture Trust bought the controllin­g 51 per cent stake in JDFPL for ₹262.65 crore.

The Tower Infrastruc­ture Trust also bought a 51 per cent stake in RJIPL, for a sum of ₹109.65 crore.

The trusts had received SEBI approvals earlier.

On March 22, RJio received approvals from the National Company Law Tribunal’s Ahmedabad Bench to hive off its fibre and tower businesses into two separate units.

In December last year, the company got board approvals to carve out the fibre and tower assets into two separate companies, providing flexibilit­y to lease them out later.

Further to the creation of two separate companies, RJio will continue to function as a telecom service provider.

This is to enable the companies to work as separate infrastruc­ture providers.

One company would offer independen­t tower services, with the other leasing out optical fibre to other telecom players and internet companies.

At present, RJio owns and operates about 2.20 lakh towers and fibre assets of close to 3 lakh route km.

Employees handling the towers and the fibre cable network are likely to be moved to the new firms. The company, however, did not provide a timeline for the completion of the hiving off process. RJio owns 2.20 lakh towers and 3 lakh route km fibre assets

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