Reliance communications at last got successful in selling
it's tower business to Brookfield where Brookfield will have the controlling
stake.Reliance Communications will continue to use their
infrastructure as Tenant with long term agreement. Reliance communications will get 11000 cr upfront in cash
and 49 % economic benefit in future based on certain condition fulfillment.
Reliance communications was trying to sell the tower
business for the last many years but failed to close the deal
Reliance communications EBITA is at par with the industry
but EBIT is way below the industry standard given the very high debt level.
The deal closer and subsequent repayment of debt will immediately
reduce Reliance communications interest burden by 30 to 35 % which in turn will
boost company earnings and cash flow in big way.
the current share price if company is very low as the
overhang of debt level kept the investor at bay.
It is advisable to buy Reliance communications share with midterm
view and don't play around with F&O market.
Disclaimer: consult
your financial advisor before investing
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