Reliance Communications agrees to sell towers business to Sanjiv Ahuja-TPG combine

Industry:    2015-12-07

MUMBAI: Reliance CommunicationsBSE -3.11 % signed a non-binding agreement to sell its telecom towers to Sanjiv Ahuja-led Tillman Global Holdings and private equity buyout group TPG in a move that could alleviate the debt woes of the company. RCom said funds from the sale, estimated at Rs 21,500 crore, will be used to pare debt of Rs 40,000 crore. Ahuja, a telecom industry veteran and former CEO of Orange Telecom, is chairman of Tillman, a three-yearold, US-based investment firm that owns and develops infrastructure the world over for telecom and tech companies. It recently diversified into energy services. Tillman Global and its associated companies have one of the most extensive global telecom infrastructure ownership footprints, with assets in over 15 countries across Asia, Africa, Europe and North America. The tower assets held by Reliance Infratel will be transferred to a separate special purpose vehicle that will be 100% owned by the Tillman and TPG combine. Together, they will also evaluate the purchase of Reliance Communications’ 190,000 km optic fibre network, a company release said. ET was the first to report that Tillman and TPG are the frontrunners for RCom’s telecom tower business, in its edition dated December 4. RCom shares fell 3.11% to Rs 81.05 at close on the Bombay Stock Exchange on Friday. At the end of its second quarter results, the company said its net debt stood at Rs 40,000 crore. The company has finally come close to sealing a deal after trying to pare its debt for some years through the sale of ventures, including its direct-to-home service, the tower assets, global business and its land banks. An attempt to hold an IPO (initial public offering) of Reliance Infratel shares some years ago was abandoned due to market volatility and uncertainty about the business. RCom will continue to be the anchor tenant on the towers after the sale. The company currently has some 45,000 telecom towers.

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