The infrastructure sector saw some interesting activity over the weekend over in South Asia. Reliance Communications may finally have found a buyer for its tower assets, and perhaps for some of its fiber as well.
RCOM has signed a non-binding term sheet with Tillman Global Holdings and TPG Asia under which the two private equity companies would take 100% ownership of Reliance’s tower and related assets. It’s not a done deal yet, as there are still final DD and approvals to get past, but RCOM would use the proceeds to reduce debt — something it has been trying to make a dent in for years now. RCOM would remain a tenant on the towers of course in support of its wireless business.
But it might not be just the towers. Tillman and TPG are also kicking the tire’s of RCOM’s national intercity and metro fiber networks as a separate and independent transaction. The announcement isn’t very specific, but it appears to be focused on the assets in India as opposed to the global submarine, IP and cloud connectivity backbone Global Cloud Xchange. But given Reliance’s many attempts to monetize that asset over the last few years, I’m sure it isn’t too far from the table. Earlier this year, GCX CEO Bill Barney’s role was expanded to include oversight of RCOM’s enterprise, IDC, and national long distance operations in India.
Terms of the proposed tower sale were not disclosed, but estimates of the value of RCOM’s tower business seem to be in the $3-4B range.
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