RCOM agrees to a settlement with Ericsson, clearing the way for its asset sale (India)
Reliance Communications (RCOM) has agreed to pay Rs 5.5 billion to Ericsson to settle its eight-month-long legal tussle with the vendor. This will allow RCOM to exit bankruptcy proceedings and move forward with its asset sale to Reliance Jio Infocomm Limited (RJIL) and Brookfield to repay lenders. The National Company Law Appellate Tribunal (NCLAT) has directed RCOM to file an undertaking that it will make the payment to Ericsson by September 30, 2018. In the event that RCOM fails to make the payment, the sale of its assets or the money recovered by the banks will be reversed and insolvency proceedings will be reinitiated. Reliance Infratel had earlier reached an amicable settlement with its minority investors.
DoT approves merger of Bharti Airtel and Telenor India
The Department of Telecommunications (DoT) has approved the merger of Telenor India and Airtel. The merger will enhance Airtel’s spectrum footprint in seven telecom circles, with the addition of 43.4 MHz spectrum in the 1800 MHz band. Telenor India runs operations in seven circles – Andhra Pradesh, Bihar, Maharashtra, Gujarat, Uttar Pradesh (East), Uttar Pradesh (West) and Assam. DoT has asked Airtel to reduce its market share based on the adjusted gross revenue in the Bihar circle to the limit of 50 per cent, within one year of the merger being approved.
RJIL raises Rs 25 billion in corporate bonds from Axis Bank
RJIL has raised Rs 25 billion in corporate bonds from Axis Bank over a term of five years at an interest rate of 8 per cent. The proceeds have been earmarked for the operator’s proposed expansion. This is the largest deal through the electronic bidding platform till date. Under the new regula-tory norms effective from the beginning of 2018-19, every borrower has to go through the electronic bidding platforms available at the exchanges, unlike the practice of personal negotiations with investment bankers.
Aditya Birla Group to sell minority stake in Idea Payments Bank
The Aditya Birla Group is planning to sell a minority stake of 15–20 per cent in Idea Payments Bank in a bid to raise about Rs 2 billion. The payments bank, in which Idea Cellular and Aditya Birla Nuvo own 51 per cent and 49 per cent stake respectively, will use the money to expand its oper-ations. Idea payments Bank, the latest entrant in this space, began operations in February 2018.
CK Hutchison and Etisalat to merge their Lankan subsidiaries (Sri Lanka)
Hong Kong-based CK Hutchison and the UAE’s Emirates Telecommunications Corporation (Etisalat) have announced the merger of their respective Sri Lankan mobile operating subsidiaries, Hutchison Telecommunications Lanka (Hutch) and Etisalat Lanka, with CK Hutchison to hold a controlling majority stake in the merged company. The merger, however, is subject to several conditions and regulatory approvals in Sri Lanka. In addition, Etisalat Lanka currently holds a 10-year licence from the Telecommunications Regulatory Commission of Sri Lanka to operate mobile services, but the concession expires in September 2018.
South Korea’s KT Corporation exits Telecom Mongolia (Mongolia)
South Korea’s KT Corporation has completed the sale of its 40 per cent stake in Telecom Mongolia to the Mongolian government. Following the stake sale, the Mongolian government has a 94.67 per cent stake in Telecom Mongolia. Earlier, in July 2017, the government had agreed to pay $2.55 million for KT’s 40 per cent stake in Telecom Mongolia, which the Ko-rean firm had acquired in August 1995 for $4.5 million.
Maroc Telecom increases its stake in Onatel to 61 per cent (Burkina Faso)
Maroc Telecom has acquired an additional 10 per cent share in its Burkina Faso subsidiary Onatel. Consequently, it now holds 61 per cent stake in Onatel. The transaction was conducted on the Abidjan Regional Stock Exchange and involved the purchase of almost 3.36 million shares totalling CFA Franc 26.88 billion. Post the stake acquisition, the government holds 20 per cent stake, public shareholders hold 13 per cent stake and the company’s staff hold 6 per cent stake in Maroc Telecom.
Orange Egypt secures $396.7 million loan (Egypt)
Orange Egypt has secured a loan worth $396.7 million from a consortium of eight banks to be repaid over a period of seven years. The loan will be partly used to refinance the company’s current loans, while a portion of it will be used for new capital expenditures for expanding 4G networks and financing the company’s expansion in the market. The consortium includes the Commercial International Bank, the National Bank of Egypt, the Bank of Alexandria, the Hongkong and Shanghai Banking Corporation, Emirates NBD, Crédit Agricole and Attijariwafa Bank Egypt.