US telecom operator AT&T is looking to acquire 26 per cent stake in Reliance Jio Infocomm, telecom arm of Mukesh Ambani’s Reliance Industries Limited. The Times of India is reporting RIL is expected to sell a little over 25% stake in Reliance Jio for $3.5 billion to AT&T.
If this deal goes through, it will be the largest foreign direct investment in the country, noted TOI. Details are not available right now on this deal, but this will be AT&T’s second entry in the India’s telecom sector. The company has earlier held one-third stake in Idea Cellular, which it later sold to other two partners Tata and Birla in 2004.
This isn’t the first time, we are hearing about AT&T and Reliance Jio deal, a report from Voice & Data in October last year also talked about Reliance’s plans to offload 26 per cent stake in Infocomm to AT&T.
“It would help RIL in two ways- they would get the much needed cash required to run the business for the initial two years; and the second is AT&T has huge experience in running BWA services in the US,” Voice & Data had explained in the October report via a source.
AT&T is currently in the process of rolling out 4G LTE in the United States, where it offers both HSPA+ and LTE services. AT&T expects to cover 300 million people with its 4G LTE network by the end of 2014. The (re)entry in the Indian market, which is also one of the biggest telecom markets worldwide, will make it an early participant in the country’s 4G revolution.
4G LTE is in its very infancy right now in the country and only Airtel currently offers 4G services that too in select cities and Reliance Jio Infocomm is the only company with licence of roll-out 4G LTE across the country.
In related news, Samsung has also partnered with RIL to provide cheap LTE smartphone to the company, which will cost as low as INR 5,500. RIL is expected to announce the launch of 4G services in India on December 28, 2013.
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