Mukesh buys big winner in broadband
Less than three weeks after the Ambani siblings signalled a second truce, elder brother Mukesh has made his move. On Friday, Reliance Industries announced a Rs 4,800-crore acquisition — giving it 95 per cent stake in Infotel Broadband, which emerged Friday as the surprise winner in the just-concluded broadband spectrum auction, with all 22 circles under its belt.
There were only two spectrum bands available across 22 circles, thus Infotel — and now RIL — becomes the only pan-India player with BWA (broadband wireless access) spectrum, which will allow high-speed Internet wireless service. RIL on its own could not have bid for the BWA spectrum earlier under the terms of the “non-compete” agreement with Anil Ambani’s ADAG. The non-compete agreement between the two groups was scrapped on May 23, a day before the BWA auction started.
Infotel Broadband is a very new company, with minimal presence in the market. It was promoted by Anant Nahata, son of Mahendra Nahata, managing director of Himachal Futuristics Communica-tions, which shot to fame in the 1990s when it bid aggressively for almost all telecom circles.
Said RIL chairman Mukesh Ambani: “We see this as the next wave of value creation opportunity in the wireless broadband space. We believe this will pole-vault India’s economy into the digital world at an accelerated pace.” Anil Ambani’s Reliance Communications welcomed RIL’s move, saying it “looked forward to offering our services to RIL ... even while we compete for customers in the marketplace.” RCom dropped out of the broadband spectrum auction last week, saying it felt the prices significantly exceeded its estimates.
With the value of a pan-India BWA licence pegged at Rs 12,847 crores, Infotel bagged one of the two licen-ces in all 22 circles. Win-ners in other circles include Aircel, Bharti Airtel and Qualcomm. The governm-ent’s combined take from the BWA and 3G auctions is now over Rs 1 lakh crores.
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