New Delhi, Apr 2 (): Ambani brothers in a historic move closed ranks to sign a Rs 1,200-crore deal. Billionaire Mukesh will use his younger bother Anil’s optic fibre network for launch of his 4G telecom venture. With this union,shares of Reliance shot up.
Under the agreement, Mukesh Ambani-led Reliance Industries’ telecom arm will lease nationwide optical fibre network of Reliance Communications (R Com) for the start of 4G services. The deal will allow both companies to mutually use towers and assets. As per agreement, Rs 1200 crore will be paid to use one lakh and twenty thousand kms multiple city fibre optic network. This amount is a one time indefeasible righ to use.
Mukesh company is Reliance Jio Infocomm Ltd. RCom in turn will have access to future optic fibre infrastructure to be built by Reliance Jio Infocomm. Joint working arrangements are to be implemented immediately for upgradation of the optic fibre network, so as to ensure uninterrupted delivery of next generation 4G services,the Reliance statement said.
This agreement is the first after separation of brothers meant for business co-operation between Reliance Jio Infocomm and RCom to get maximum utilization of the existing and future infrastructure built by both companies on reciprocal basis, including towers, intra city fibre and inter city fibre.
Shares in Anil Ambani group companies rose sharply after the deal, after speculation about a wider agreement among the brothers. Even though Mukesh’s Reliance Industries rose only by 2%, it was Anil’s Reliance Comunications that shot up by 17% and their infra wing by 5% and capital by 6%.
The coming of two brothers at a wedding recently and that 4G services would be made on RCom infra was being speculated. However, the deal signed by two brothers show that more such deals are in offing as both companies are facing losses and closing of ranks is the need of the hour.
At the Gujarat Summit too, fondness to Mukesh by Modi was evident.