Reliance Communications may renew efforts to sell equity stake in its tower unit after the deal with Reliance Jio. RCom had tried to sell equity in its tower subsidiary Reliance Infratel twice but did not succeed.
But now with assured revenues from Reliance Jio for the remaining period of the company’s licence, Reliance Infratel may get the kind of valuations which Anil Ambani has been looking for.
“If one were to go by the valuation, Reliance Infratel could claim a value between Rs 25,000 crore and Rs 30,000 crore based on the current valuation of Bharti Infratel, which is roughly the same size as the Reliance unit. We could sell a stake if we want to improve the financials,” said an RCom executive on conditions of anonymity. Last year, private equity firms Blackstone and Carlyle Group called off talks to buy majority stake in Reliance Infratel citing high valuations. According to industry sources, Reliance was seeking a valuation of around Rs 20,000 crore for its tower unit, which the PE firms felt was too high.
Reliance Infratel, which has about 50,000 towers, could now engage in a fresh round of discussions with investors in a bid to retire its Rs 35,000-crore debt.
It could also float an initial public offering, but the tepid response received by Bharti Infratel for its public float last year may act as a dampener. Although Bharti Infratel’s Rs 4,500-crore issue was subscribed fully, it needed a push from institutional investors as retail investors stayed away.
In 2008, Reliance Infratel had scrapped its Rs 6,000-crore float due to poor market conditions after getting all the regulatory approvals.