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Business deals

Singapore GIC leads $3.4bn deal for Reliance telecom towers

Sovereign wealth fund and partners secure 135,000 structures from Indian giant

GIC's investment in Reliance unit will allow it to further tap the Indian telecoms market.   © Reuters

SINGAPORE -- Singaporean sovereign wealth fund GIC said on Tuesday that it has joined with co-investors, including Canada's Brookfield Infrastructure Partners, to purchase an Indian telecom tower company from a unit of Reliance Industries for $3.4 billion.

The acquisition gives the state investor and its partners a 100% stake in the telecom tower company held by Reliance Industrial Investments and Holdings Limited, a wholly-owned subsidiary of Indian billionaire business magnate Mukesh Ambani's Reliance Industries Limited.

The deal covers around 135,000 communication towers which form Reliance Jio Infocomm Limited's telecommunication network -- recently constructed for cellular network coverage across India, GIC said in a statement.

"The portfolio offers resilient income and long-term value given India's attractive data demand growth outlook as 4G and smartphone penetration is still very low," said Ang Eng Seng, GIC's chief investment officer for Infrastructure. "While we remain cautious in this period of high uncertainty, we continue to seek good, long-term opportunities in India."

GIC said that more towers are planned, with the increase leading to the building of a robust telecommunications market within the country.

Jio is the anchor tenant of the tower portfolio under a 30-year Master Services Agreement, which GIC said will provide the tower company with a secure, long-term source of revenue. 

Reliance Industries is the largest private-sector company in India. Besides telecommunications, it is involved in oil refining as well as the petrochemical, gas, retail and textile businesses. It is a core unit of Reliance Group, which ranks alongside Tata and Birla among India's country's major conglomerates.

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