RCOM, AIRCEL MUTUALLY CALL OFF MOBILE BIZ MERGER DEAL

NEW DELHI: Telecom operators Reliance Communications and Aircel on Sunday terminated their mobile business merger deal.

"Merger of mobile business of Reliance Communications and Aircel lapses with mutual consent," Reliance Communications said in a release.

Both the telcos had signed binding agreements in September 2016 for the merger of Reliance Communications' mobile businesses with Aircel.

Legal and regulatory uncertainties, and various interventions by vested interests, have caused inordinate delays in receipt of relevant approvals for the proposed transaction, he Anil Ambani-led firm said.

"Unprecedented competitive intensity in the Indian telecom sector, together with fresh policy directives adversely impacting bank financing for this sector, have also seriously affected industry dynamics. As a result of the various factors aforesaid, the merger agreement has lapsed.

The Board approved the same," it added.

Reliance Communications was expecting a significant debt reduction post completion of merger with Aircel. Reliance Communications' net debt stood at Rs 44,345 crore at the end of March 2017.

The board of directors of the company at a meeting held on Sunday reviewed the transformation programme and considered alternate plan to reduce debt.

The company said it will evaluate alternative plan for its mobile business by optimising spectrum portfolio and focus on 4G technology as part of its ongoing strategic transformation.

Reliance Communications has been given time till December 2017 to service its debt obligations by its lenders.