Saturday, 25 May 2019

SoftBank doing due diligence on Reliance Jio

By Nick Wood, for Total Telecom
Thursday 25 April 19

Japanese telco's Vision Fund reportedly mulling $2 billion-3 billion investment in Indian counterpart

SoftBank's venture capital arm, Vision Fund, has undertaken due diligence with a view to buying a stake in Reliance Jio Infocomm, it emerged this week. According to an Economic Times report…

SoftBank's venture capital arm, Vision Fund, has undertaken due diligence with a view to buying a stake in Reliance Jio Infocomm, it emerged this week.

According to an Economic Times report, the Japanese telco could invest $2 billion-3 billion in its Indian counterpart.

Mukesh Ambani, chairman of Jio and its parent company Reliance Industries, is understood to be keen to sell stakes in various of his companies as part of a continued effort to reduce debt.

In line with this strategy, Jio earlier this month completed the transfer of its fibre optic and towers assets to two newly-formed infrastructure investment trusts. The ET this week cited an HSBC research note which calculated that the transfer helped to reduce Reliance Industries' consolidated adjusted net debt to $33.2 billion at the end of the fourth quarter, compared to $42.7 billion at the end of the prior quarter.

Meanwhile, the $100 billion SoftBank Vision Fund is still on the hunt for fast-growing tech companies.

Jio certainly fits the bill.

According to the most recent data available from the Telecom Regulatory Authority of India (TRAI), Jio added 7.8 million mobile customers in February, leaving it with 297.2 million in total. By comparison, its two larger rivals, Bharti Airtel and Vodafone Idea, lost 50,000 and 5.8 million customers respectively.

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