RCom to develop real estate to pare debt
08 Jul 2013
Reliance Communications (RCom) is gearing up to develop its real estate, for which the telecom major received board approval on Sunday. The company's board also approved the demerger of its real estate into a separate firm, Reliance Properties Ltd.
The company has a debt of about Rs39,000 crore. Earlier this week, RCom paid off debts totaling about Rs6,000 crore.
This is a part of the company's strategic plan to divest non-core assets and focus on its core wireless and enterprise business. The demerger is subject to shareholders and regulatory approvals, RCom said in a statement.
The board has set up a committee to consider the matter in detail, and prepare the necessary demerger scheme among others in consultation with legal and other advisors.
Reliance Properties would be separately listed in which shareholders will receive fully-tradeable pro-rata shareholding, free of cost, based on their existing shareholding in RCom.
The monetisable value of RCom's real estate on development is estimated by independent valuers at more than Rs12,000 crore or equal to Rs60 per RCom share.
In December last year, Reliance Group had entered into partnership with leading Chinese real estate developer Wanda Group to set up a wide ranging joint venture.
The proposed JV would also develop integrated township projects in India, including commercial buildings and residential condos, apartments and hotels.
