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Home / News / Business News / RCom-Brookfield deal: Investors see no upside
  • Business

    RCom-Brookfield deal: Investors see no upside

    Sneha Johny
    Written by
    Sneha Johny
    Mail
    Last updated on Dec 24, 2016, 07:35 am
    RCom-Brookfield deal: Investors see no upside
    Credits:
  • Reliance Communication's deal with asset management group Brookfield Infrastructure to sell its tower business hardly excited any investors.

    Attempting to reduce its debt burden by a whopping $4.6 billion, nearly 70% of the company's debt would be pruned.

    This failed to impress investors since its market capitalization rose only Rs.200 crore after the deal, considering its market cap fell by Rs.13,000 crore this year.

  • In this article
    Reliance Communications Brookfield Infrastructure Group Reliance Communications' rising debts Reliance Communications inks deal with Brookfield RCom-Brookfield deal: Investors see no upside RCom's gloomy market capitalization offers no respite
  • About

    Reliance Communications

    Reliance Communications
    Credits:
  • Reliance Communications is an Indian internet and telecommunications company based in Mumbai.

    Headed by Anil Ambani, the company was launched in 2002 and has since grown to touch nearly 99 million million subscribers this year.

    Pitched to be the fourth largest telecom company in the country, RCom garnered Rs.220 billion in revenues and Rs.7.14 billion in profits last year.

  • Information

    Brookfield Infrastructure Group

  • Brookfield Infrastructure is an investment and asset management company headquartered in Canada. With assets of over $250 billion under the company, the group had expressed interest in acquiring RCom's tower business.

  • India Inc.'s debt

    Reliance Communications' rising debts

    Reliance Communications' rising debts
  • With India's corporate giants slipping to massive debts, Reliance Communications' debts saw the company become the most indebted telecom operator in India.

    With debts amounting to Rs.41,362 crore, the company is one of the most leveraged in India.

    Reliance Communications has been eyeing deals and partnerships with other groups to de-leverage the company's huge debts and gain investor confidence.

  • 15 Oct 2016

    Reliance Communications inks deal with Brookfield

    Reliance Communications inks deal with Brookfield
  • In October this year, Reliance Communication signed a deal to sell 51% of its stake in the mobile tower business to Brookfield Infrastructure Group for Rs.11,000 crore in cash payment.

    The Anil Ambani-led company retained the remaining 49% of the company.

    The deal was part of Reliance Communication's efforts to restructure the company to help reduce the heavy debt burden.

  • 24 Dec 2016

    RCom-Brookfield deal: Investors see no upside

    RCom-Brookfield deal: Investors see no upside
    Credits:
  • Reliance Communication's deal with asset management group Brookfield Infrastructure to sell its tower business hardly excited any investors.

    Attempting to reduce its debt burden by a whopping $4.6 billion, nearly 70% of the company's debt would be pruned.

    This failed to impress investors since its market capitalization rose only Rs.200 crore after the deal, considering its market cap fell by Rs.13,000 crore this year.

  • Quote

    RCom's gloomy market capitalization offers no respite

  • "It is evident investors aren't factoring in an upside from the retained stake; after all, RCom's market value hasn't changed dramatically and still is only around Rs.8,900 crore," said an analyst.

  • India
  • Mumbai
  • Anil Ambani
  • Reliance Communications
  • Reliance Communication
  •  
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