Reliance Communications (RCom) is increasing its capital expenditure for the current financial year and next fiscal to about Rs 4,000 crore as it plans to increase its focus on 3G and 4G services. Separately, the company is also inching towards closing its tower deal, which is expected to be sealed within a fortnight.
The company controlled by billionaire Anil Ambani had earmarked a capex of Rs 3,000 crore for this financial year, which is now being increased by another Rs 1,000 crore. The company's capex for the previous financial year stood at Rs 1,500 crore.
"We are raising our capex guidance to Rs 4,000 crore for this fiscal and next year to strengthen our 3G network,” RCom Chief Executive Officer Gurdeep Singh (consumer business) said in an analysts' call.
A part of the investment would be used to upgrade its 4G network, and part for its 3G network, said, adding, the company is looking to further consolidate its presence, he added.
RCom, controlled by billionaire Anil Ambani, also expects to tie-up its tower deal within the next two weeks.
“We expect to close the deal in two weeks,” RCom Chief Executive Officer Vinod Sawhny said in the same analysts’ call.
RCom had earlier entered into a non-binding agreement with to sell its telecom towers to two private equity firms, with a January 15 deadline for talks. However, this was extended by another 15 days.
On December 4, 2105, RCom had signed non-binding agreements with private equity firms Tillman Global Holdings and TPG Asia to sell its tower assets. Separately, the firms were also evaluating to acquire RCom’s nationwide inter- and intra-city optical fibre assets.
Together the transactions were expected to fetch about ₹30,000 crore, all of which were to be used to pare RCom’s debt, which was at about ₹40,000 crore.