Big bro rescues RCom, strengthens Jio

Reliance Communications which is going through turbulent times was lent a helping hand by big brother Mukesh Ambani's as Reliance Jio Infocomm agreed to buy assets of RCom. Bankers value the deal at Rs. 24,000 crore.

Jio Infocomm emerged as the highest bidder to acquire the wireless spectrum, tower, fiber and Media Convergence Node (MCN) assets of RCom. The deal includes cash payment and transfer towards deferred spectrum instalments payable to DoT, while proceeds will be used purely for debt reduction. The assets comprise 4G Spectrum of 122.4 MHz in the 800/900/1800/2100 MHz bands, around 43,000 towers, 1,78,000 RKM of fiber with across the country and 248 MCN, covering close to 5 million sqft area employed for providing telecom infrastructure.

For Jio this is a strategic acquisition which will help the company scale-up wireless and Fiber-to-Home and Enterprise services offerings.

At 10:31 hours on Friday, the stock of RCom was trading at Rs. 37.10 per share, up Rs. 6.14 or 19.83 per cent. The stock hits a new 52-week high of Rs. 41.77 per share, while it has been gaining for the last four days and has risen 127.28 per cent. RCom stock's also showed a volume uptick of 74.34 per cent compared to the stock's 5-day average volume. Meanwhile, Reliance Industries was trading at Rs. 925.00 per share, up by 0.06 per cent.