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Band of brothers: Ambanis join hands for Rs 1,200-cr telecom deal
Shiv Kumar/TNS

The agreement Mukesh Ambani’s RIL's Reliance Jio Infocomm will share RCom's (managed by Anil Ambani) nationwide inter-city fibre optic network. Reliance Jio Infocomm is launching its 4G services later this year. In turn, RCom would get access to the optic fibre infrastructure to be built by Reliance Jio Infocomm. Agreement also signals future co-operation between the companies whose promoters fell out but later patched up.

Mumbai, April 2
Mukesh Ambani's Reliance Industries Ltd (RIL) and RCom managed by his younger brother Anil today announced a Rs 1200-crore deal to share telecom infrastructure and promised deeper co-operation in the coming days.

In filings to exchanges, both companies said they have signed an agreement under which RIL's Reliance Jio Infocomm will share RCom's nationwide inter-city fibre optic network infrastructure spread over 1,20,000 km. Reliance Jio Infocomm is launching its 4G services later this year.

In turn, RCom would also get access to the optic fibre infrastructure to be built by Reliance Jio Infocomm in the coming days, according to the agreement between the two companies.

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

RIL said the agreement portends the future co-operation between the companies whose promoters fell out publicly but later patched up.

“The agreement is the first in an intended comprehensive framework of business co-operation between Reliance Jio Infocomm and Reliance Communications. It will also allow both the companies to utilise the existing and future infrastructure of both companies on reciprocal basis, including, inter alia, inter-city fibre, intra-city fibre, towers and related assets," the statement said. Reliance Jio Infocomm (RJI), formerly Infotel Broadband, won 4G spectrum for pan-India services in 2010, but the company is yet to launch its services.

Government recently approved norms that would allow the RJI to even provide mobile phone calls service using its 4G spectrum. This leaves room for Mukesh Ambani's re-entry into mobile phone services business after 2005 following Anil Ambani moving out with RCom, formerly Reliance Infocomm, Reliance Energy and Reliance Capital.