Reliance Jio Aims to Raise Rs35bn Ahead of 4G launch
Nascent Indian mobile operator Reliance Jio Infocomm plans to raise up to Rs35bn (US$545.7m) in a debt issue prior to launching 4G services.
Nascent Indian mobile operator Reliance Jio Infocomm plans to raise up to Rs35bn (US$545.7m) in a debt issue prior to launching 4G services.
The company, a subsidiary of conglomerate Reliance Industries, intends to issue secured, redeemable, non-convertible debentures on a private placement basis, it said in a regulatory filing. The board of directors and shareholders have approved the issue. No further details were provided.
Jio last tapped debt markets in June when it inked a 12-year US$750m loan backed by Korea Trade Insurance Corporation (K-sure) to fund goods and services from Samsung and Ace Technologies. This facility was funded by nine banks:HSBC, ANZ, Banco Santander, The Bank of Tokyo-Mitsubishi, JP Morgan Chase, Mizuho, Sumitomo Mitsui, ING and DZ.
Jio, the newest entrant to India’s crowed mobile market, aims to launch 4G services around December. Reliance Industries chairman Mukesh Ambani told shareholders last month that Jio was in the pre-launch testing and stabilisation phase of developing its network and would conduct a beta launch over the next few months.
The operator, the first to hold a pan-India licence, spent nearly U$2bn at the country’s spectrum auction earlier this year and, according to Ambani, has invested nearly US$5.3bn in spectrum in total. Jio aims to double its fibre footprint – the network currently spans 250,000 route kilometres – over the next three years.
Analysts have speculated that Jio’s entry could drive down prices in the ultra-competitive mobile sector, which already has among the lowest tariffs worldwide. Ambani said he is confident 4G-compliant devices below the Rs4,000 (US$63) mark will be available in India by the end of the year, along with voice and data packages from Rs300-Rs500 (US$5-US$8) per month.
