Reliance Acquiring 95% Of Infotel For $1 Billion

Posted Jun 11, 2010

Reliance Industries Chairman Mukesh Ambani announced that the company will be paying $1 billion to acquire 95% of Infotel Broadband Services Pvt. Ltd.  Infotel just won the rights to high-value radio spectrum in a government auction.

Interestingly enough, Mukesh’s younger brother and rival Anil Ambani runs Reliance Communications Ltd., the second largest carrier.  Due to a family noncompete agreement, Mukesh was banned from entering the telecom sector.  However Mukesh and Anil scrapped that agreement last month.

Infotel is the only company that bought a pan-India license for a 4G spectrum in the government auction.  The government auction of wireless airwaves helped raise $8.23 billion.  Some of the winners in that auction include Infotel, who agreed to pay $2.74 billion for nationwide bandwidth and Qualcomm, who will spend $1 billion for airwaves in four regions.  Bharti will spend $720 million and Aircel Ltd. agreed to pay $747 million in 8 areas.