Ambani brothers sign 4G telecoms deal

02 April 2013 |


Indian tycoons Mukesh and Anil Ambani have announced a partnership to launch 4G services through their respective telecoms arms, Reliance Industries and Reliance Communications.

The billionaire Indian brothers split Reliance Industries, the business empire their father had founded, in 2005, following a widely-reported feud.

Mukesh inherited the energy and petrochemical business, while Anil took over the power, financial services and emerging telecoms business, Reliance Communications.

Under terms of the agreement, Reliance Jio Infocomm, the telecoms arm of Mukesh’s Reliance Industries, will spend a reported Rs12 billion ($221 million) to use Reliance Communications’ optical fibre network for the roll-out of 4G services.

“The agreement provides for joint working arrangements to be put in place immediately for upgradation of the optical fibre network, to ensure seamless delivery of next generation services,” Reliance Communications said in a statement.

Reliance Communications is expected to benefit from access to optic fibre infrastructure built by Reliance Jio Infocomm in the future.

“This is a small deal, but I think it is a win-win, given that RCom needs the additional revenues and Reliance needs the infrastructure,” said Pradip Shah, chairman of Mumbai-based financial services group, IndAsia Fund Advisors.

“But it also shows they have both made peace on a personal basis and so it seems they will be open to commercial agreements in other areas too, which will certainly attract the attention of their competitors around India and beyond.”

The brothers appeared to be working in a more harmonised fashion in 2010, but this agreement is thought to be the first solid partnership since their initial split.