Reliance Communications To Exit Telecom Entirely, Focus On Real Estate: Anil Ambani

| September 18 , 2018 , 15:28 IST

Billionaire businessman Anil Ambani on Tuesday announced that the cash-strapped Reliance Communications (RCom) will be exiting the telecom business completely and instead will focus on real estate in future.

During the company's 14th annual general meeting in Mumbai, Ambani said to shareholders that the first priority for RCom, which gained popularity in the early 2000s with its cheaper offers, is to resolve its over Rs 40,000 crore debt.

RCom owes more than Rs 40,000 crore to a group of 38 lenders which include Chinese banks, and had been resolving the debt through a strategic debt restructuring (SDR) process.

ALSO READ: Rafale Deal: Reliance Files Rs. 5000 Crore Defamation Suit Against Congress's National Herald

“We have decided that we will not proceed in this sector. And many other companies have taken a similar call. This is very much a writing on the wall, the future," Ambani said.

"Employment in the sector has halved over the last two years— hyper-competition has led to over 20 lakh job losses," he said.

“As we have moved out of the mobile sector, we will monetise at an appropriate stage our enterprise business. Reliance Realty will be the engine of growth for the future of this company,” Ambani said.

Giving an example of the 133-acre Dhirubhai Ambani Knowledge City (DAKC) on the outskirts of Mumbai, Anil Ambani highlighted the huge realty play opportunity that RCom's erstwhile corporate headquarters possesses, estimating the potential value creation at the site to be worth Rs 25,000 crore.

ALSO READ: Reliance Industries Market Cap Reaches Rs 8 Lakh Crore

At the AGM, Ambani said that he is confident of getting a resolution in the next few months, and that other monetisation measures, such as the sale of telecom infrastructure and fibre to Reliance Jio, are at an advanced stage of closure. He added that the company is awaiting final approvals from the Department of Telecom regarding spectrum sharing and trading.

Anil Ambani thanked his elder brother Mukesh Ambani, who is credited with conceptualising the group's foray into the field of telecom and bought the assets as part of RCom's monetisation efforts.

“It would be most appropriate for me to thank and acknowledge the support (and) guidance extended to RCom and me personally by my brother Mukesh bhai Ambani,” Anil Ambani said to shareholders at the meeting.