Indian carrier raises $750 million loan for 4G rollout
ROSEMARY MARANDI, Nikkei Staff Writer
MUMBAI -- Reliance Industries' broadband venture Reliance Jio Infocomm said on Wednesday it has raised a $750-million loan, backed by Korea Trade Insurance Corporation, to pay for equipment and services from Samsung Electronics and Ace Technologies Corp for its fourth-generation telecoms services rollout.
The 12-year loan will be provided by a syndicate of nine banks - Australia and New Zealand Banking Group, Banco Santander, DZ Bank, ING Bank, JP Morgan Chase Bank, HSBC, Bank of Tokyo-Mitsubishi, Mizuho Bank and Sumitomo Mitsui Banking Corp.
The deal marks the second round of Reliance Industries' financing backed by South Korean export credit agencies.
Samsung is reportedly supplying 70,000 base transceiver stations for Reliance Jio Infocomm in a $1.2 billion contract. Ace Technologies is another South Korean company that provides wireless radio equipment.
Reliance Jio is set to launch the 4G service this year. It has earmarked 700 billion rupees for investment and is planning to offer service in 90% of urban areas and to more than 210,000 villages.
Reliance Jio is the newest player in India's telecom business. It is set to take on rivals like Bharti Airtel and Vodafone India as it offers its services across India.
Goldman Sachs India said that telecom infrastructure in the country is developing at a rapid pace and the potential Reliance Jio launch in 2015, together with the government's Digital India initiative may help improve the current fiber optic coverage of only 9%.
India has enough spectrum and telecom infrastructure to provide 3G data coverage to 25%--30% of the population, according to Goldman Sachs.