Reliance Communications

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Reliance Communications Ltd
Public
Traded as
IndustryTelecommunication
Founded27 December 2002; 15 years ago (27 December 2002)
FounderDhirubhai Ambani
HeadquartersDAKC, Kopar Khairane, Navi Mumbai, Maharashtra, India
Key people
Products
RevenueRs 4684 crore [1] (2018)
OwnersReliance ADAG(90%)
SSTL (10%)
Number of employees
3000+[2] (2018)
Subsidiaries
Websitewww.rcom.co.in

Reliance Communications (stylised as RCOM) is a telecommunications operator in India and through its international subsidiary Global Cloud Xchange.

Reliance Communications is also one of the largest IDC service providers with data centers in four cities, having a total capacity of over 1.1 million square feet. A new data center is also under construction. [3]

History[edit]

Reliance Communications was founded in India in 2002[4] with the introduction of its nationwide CDMA2000 service. The company introduced its GSM service in 2008, and began using MIMO technology in 2011 to improve the quality of its 3G service (providing a data rate of up to 28 Mbit/s).[5][unreliable source?]

In the 2010 spectrum auction, Reliance obtained 3G spectrum in three cities for 58,642.9 million.[6] The company reduced the price of its 3G service by 61 percent in May 2012.[7] Reliance joined Lenovo to introduced their co-branded Android smartphones in India the following year.[8] The company ended its CDMA operations in 2016, and migrated subscribers to its GSM and LTE networks by September of that year.[9][10]

Acquisition of MTS India[edit]

On 14 January 2016, Reliance announced that it had acquired Sistema Shyam TeleServices Limited (SSTL, doing business as MTS India) in an all-stock deal in which SSTL received a 10-percent stake in Reliance after paying its existing debt. Reliance would assume responsibility for installments which MTS owed the government for spectrum purchases, amounting to 392 crore annually for 10 years. As a result of the deal, Reliance acquired MTS India's subscribers and SSTL's spectrum in the 850-MHz band.[11]

The merger was approved by the Competition Commission of India (CCI) in February 2016.[12] The SEBI cleared the deal by March, and SSTL shareholders approved the merger on 18 March.[13] By mid-August, it was approved by tax authorities and the shareholders and creditors of Reliance and SSTL.[14] The merger was approved by the Rajasthan High Court on 30 September 2016[15] and the Bombay High Court on 7 October.[16] In April 2017, Reliance laid off 600 employees in preparation for mergers with MTS and Aircel.[17] Final approval (from the Department of Telecommunications) was given on 20 October 2017,[18][19] and on 31 October Reliance announced that it had completed the merger.[20][21]

Attempted merger with Aircel[edit]

On 14 September 2016, Reliance and Maxis Communications (owners of Aircel) announced that they would merge their mobile networks. The deal, the largest consolidation in Indian telecommunication history, would have created the fourth-largest mobile network operator in the country in subscribers and revenue. Reliance and Maxis would each hold a 50-percent stake in the merged entity, with equal representation on its board of directors and committees. Reliance would continue to operate in the enterprise segment and data-center businesses as a standalone company.[22][23]

The company announced on 15 March 2017 that it had received approval from the SEBI, BSE, and NSE.[24][25][26] The deal was approved by the CCI on 20 March.[27][28] Aircel and Reliance shareholders approved the merger on 22 and 24 April 2017, respectively,[29] and it was expected to be completed by mid-2017.[30]

However, on 1 October Reliance announced that it is had allowed the merger agreement to lapse.[31] The deal, which was expected to help the company pare 25,000 crore of debt, was cancelled due to delays by entrenched competition.[32] Reliance was looking at other options to meet their obligations under the SDR agreement and avoid insolvency proceedings by banks.[33] Due to the failed Aircel merger, the company announced to employees in the wireless and DTH businesses on 25 October 2017 that they would be redundant effective 30 November. On 29 December 2017, Reliance discontinued voice services in India and would provide only 4G data service.

References[edit]

  1. ^ {{cite web|url=http://rcom.co.in/our-company/investor-relations/financial-results/
  2. ^ https://rcom.co.in/our-company/investor-relations/financial-results/
  3. ^ Template:Https://rcom.co.in/our-company/investor-relations/
  4. ^ "Reliance set to revolutionise mobile services". Rediff. 27 December 2002. Retrieved 29 November 2017.
  5. ^ "Reliance Improved their 3G with MIMO Technology". Teletechnology of India. 22 August 2011. Archived from the original on 12 October 2013. Retrieved 5 October 2013.
  6. ^ "RCom launches 3G services in 3 cities". The Hindu. Chennai, India. 14 December 2010. Archived from the original on 17 December 2010. Retrieved 8 March 2011.
  7. ^ "RCom slashes 3G tariff by 61%". The Times of India. 25 May 2012. Retrieved 25 May 2012.
  8. ^ "RCom partners Lenovo to launch sub-Rs 8,000 smartphone". The Hindu. 31 January 2013. Archived from the original on 28 May 2018.
  9. ^ "RCom kicks off migration process; to upgrade CDMA subscribers to 4G LTE network". 2016-04-02. Retrieved 2016-09-14.
  10. ^ "Reliance Communications Posts Nearly 6% Rise In Q1 Profit". NDTV. Retrieved 2016-09-14.
  11. ^ "Reliance Communications acquires Sistema's MTS India in all-stock deal". www.businesstoday.in. Retrieved 2016-09-06.
  12. ^ "Reliance Communications Gets CCI Approval to Acquire MTS". Retrieved 2016-09-06.
  13. ^ "Sistema Shyam shareholders approve merger with Reliance Communications". Retrieved 2016-09-06.
  14. ^ "DoT's approval for SSTL-RCOM merger likely in Q4: Sistema - The Economic Times". Retrieved 2016-09-06.
  15. ^ India, Press Trust of (30 September 2016). "RCom gets Rajasthan HC approval for Sistema acquisition". Business Standard. Retrieved 1 October 2016.
  16. ^ "Reliance Communication gets Bombay HC approval for Sistema acquisition - The Economic Times". The Economic Times. Retrieved 2016-10-08.
  17. ^ "Pink slips for 600 as Reliance Communications trims fat". The Economic Times. Retrieved 5 May 2017.
  18. ^ "Telecom department approves RCom-MTS merger - ET Telecom". ETTelecom.com. Retrieved 18 November 2017.
  19. ^ "RCom-Sistema Shyam merger gets DoT approval". The Economic Times. 2017-10-23. Retrieved 2017-10-24.
  20. ^ "Reliance Communications Completes Merger With MTS". NDTV. Retrieved 18 November 2017.
  21. ^ "Reliance Communications completes merger with MTS". Zee News. 31 October 2017. Retrieved 18 November 2017.
  22. ^ "RCom, Aircel announce merger; create fourth largest telco in India - Times of India". Retrieved 2016-09-14.
  23. ^ Pandey, Piyush (2016-09-14). "RCom-Aircel merger a strong challenger to Idea Cellular". The Hindu. ISSN 0971-751X. Retrieved 2016-09-14.
  24. ^ "Reliance Communications Gets SEBI, Exchanges Nod For Aircel Merger". NDTV. Retrieved 20 March 2017.
  25. ^ India, Press Trust of (15 March 2017). "Reliance Communications gets Sebi nod for merger with Aircel". Business Standard India. Retrieved 20 March 2017.
  26. ^ Bureau, Our (15 March 2017). "RCom-Aircel merger gets SEBI nod". The Hindu Business Line. Retrieved 20 March 2017.
  27. ^ Feeds, IANS (20 March 2017). "RCOM gets CCI approval for Aircel merger". India.com. Retrieved 20 March 2017.
  28. ^ Lead, Telecom (20 March 2017). "RCOM-Aircel merger deal gets CCI approval". TelecomLead. Retrieved 20 March 2017.
  29. ^ "Anil Ambani-driven RCom, Aircel shareholders approve merger - ET Telecom". ETTelecom.com. Retrieved 5 May 2017.
  30. ^ "RCom says Aircel merger to be completed by 2017 middle, MTS merger by March". Telecom Talk. Retrieved 15 February 2017.
  31. ^ "RCom abandons mobile business merger with rival Aircel". Financial Times. Retrieved 18 November 2017.
  32. ^ Sengupta, Devina (2017-10-02). "RCom calls off Aircel merger; blames legal uncertainties, policy directives for delay". The Economic Times. Retrieved 2017-10-02.
  33. ^ Raj, Amrit (2017-10-03). "RCom readies for fire sale of its assets to pare debt, as Aircel merger fails". Livemint. Retrieved 2017-10-02.

External links[edit]