Anil Ambani, chairman of Reliance Communications, said his company has “virtually merged” with Reliance Jio, promoted by his brother Mukesh Ambani, and said the two brothers are working together.
“Our spectrum is shared, our network is shared, our fiber is shared, our towers are shared, our voice is shared.. every effort to be capital light has been achieved. We have a full 4G network on a pan-India basis without any capital expenditure on Reliance Communications’ balance sheet,” Ambani said, reacting to questions from shareholders about the way forward for RCom.
In an apparent reference to the family feud that existed between the two brothers for almost a decade, Ambani said — without using the words — that the two brothers had patched up for good.
“There are two committed brothers — Mukesh Ambani and Anil Ambani — both working relentlessly to fulfill the dream of Dhirubhai Ambani,” he added.
Ambani was trying to put the point across that his company has not been caught napping by technology change.
RCom has been under pressure from competitors, including from Jio, due to the emergence of high-speed 4G technology that threatens to totally change the telecom sector in the country.
RCom has come under a lot of criticism from analysts for not investing in its network for several years. It was only late last year that it restarted expanding its 3G network after a gap of about five years.
Anil Ambani said RCom already has more than 1 million paying 4G customers using (on average) more than 1 GB of data monthly.
“With the virtual merger of the Reliance Jio and Reliance Communications, we have eliminated the need for capital expenditure for (rolling out) a 4G network,” the younger Ambani brother said, adding that putting up a 4G network would have cost Rs 20,000 cr or so.
On high debt levels, he said the ongoing merger with Aircel will further help the company reduce its debt by about 20,000 cr.
He also dismissed allegations that he was ‘selling’ the company and walking away.
Pointing out that RCom, as it exists now, will own 50% of the combined RCom-Aircel entity, he said there was no question of him selling out in favor of Maxis, the owner of Aircel.
On spectrum auction, he said RCom already has enough spectrum, and doesn’t have to spend like other operators to survive in the emerging 4G era.
“I leave this AGM with great confidence about the future of Reliance Communications, the future of RCom shareholders…” he added.