Etisalat DB, RCom sign Rs10,000-crore tower sharing deal

Etisalat DB Telecom India, the Indian arm of the Gulf region's second largest telecom operator which has acquired a 45 per cent stake in new telecom player Swan Telecom, has signed a 10-year tower sharing deal with Reliance Communications which could be worth Rs10,000 crore over the 10-year period.

Etisalat-Swan has mobile licenses to offer mobile services in 15 of the 22 telecom circles in the country, and it will use Reliance Communications' towers to roll out its network.

While Etisalat owns 45 per cent in Swan, the remaining 55 per cent is held by several entities, including Swan's primary promoter, the Dynamix Balwas Group, a Mumbai-based real estate and hospitality business group.

''This agreement presents large cost optimisation benefits with an asset-light model, improvement in capital productivity and enhances RCom group revenues by Rs10,000 crore. The agreement with Reliance Communications Group is the first agreement of its kind in India and strongly complements Etisalat DB Telecom's plans for India,'' Etisalat and & RCom said in a joint statement on Wednesday.

Commenting on the deal, Etisalat chairman Mohammad Hassan Omran said, ''As a new entrant in this dynamic market, this alliance provides us with key, strategic advantages that will ensure a robust, speed to market and cost-effective roll-out of services. Strategic alliances are an integral part of our plans for growth and Etisalat Group will always be receptive to such alliances.''

Reliance ADA Group chairman Anil Ambani said, ''This is a landmark agreement that will re-define the future of Indian telecom sector. It demonstrates Reliance Communications' capabilities to enable the operators to go to market with a bouquet of telecom infrastructure services. This will ensure a faster rollout, optimum costs and a time to market advantage,'' he added.