Reliance Industries Ltd., led by billionaire Mukesh Ambani, said it will share mobile-phone towers controlled by Ambani’s younger brother in a transaction valued at about 120 billion rupees ($2.1 billion).
The pact to use billionaire Anil Ambani-owned Reliance Communications’ 45,000 phone towers will help accelerate fourth-generation broadband service by Reliance Jio Infocomm Ltd., a unit of elder brother Mukesh’s Reliance, according to statements issued by the two companies today.
The deal, the second in as many months, comes a day after Mukesh told shareholders in Mumbai he intends to more than triple Reliance Jio’s workforce to 10,000 as the company prepares to start the services. Reliance Communications will receive the $2.1 billion sum over “lifetime of the agreement,” according to the statements which didn’t specify the duration.
“We need some clarity on the timeframe for this deal,” Harit Shah, a Mumbai-based analyst at Nirmal Bang Equities Ltd. said in a phone interview. Reliance Communications’ debt is a “huge concern. I don’t know how significantly this deal will help reduce that.”
Reliance Communications dropped 1.2 percent to 116.5 rupees at close in Mumbai today.