Reaffirming its focus on broadband connectivity, Reliance Industries has acquired a majority stake in two major broadband providers Den Networks and Hathway Cable and Datacom.
In Den Networks, RIL has acquired 66% through a primary investment of Rs. 2,045 crore through a preferential issue and secondary purchase of Rs. 245 crore from the existing promoters.
In Hathway, it has acquired a 51.3% stake through a primary investment of Rs. 2,940 crore through a preferential issue.
According to a statement from the company, these strategic investments are in furtherance of Reliance’s mission of providing India with affordable broadband service.
“After having taken India to the top position in the mobile broadband space, Reliance is now committed to take India from a global rank of 135th to among the top-3 countries in the world on wireline digital connectivity,” the company said in a statement.
Reliance claims that these strategic investments will create a win-win outcome for the Local Cable Operators (“LCOs”), Consumers, Content providers and overall eco-system.
LCO’s who provide local broadband services, operating in most neighbourhoods have reportedly been losing market share because of increasing competition from alternate technologies like Direct-To-Home (“DTH”).
A statement from Reliance claims that DTH operators have weaned away over 60 million homes from cable operators who have remained basic TV service providers.
Through this transaction, Reliance and Jio claims to be strengthening the 27,000 LCOs that are aligned with DEN and Hathway by giving them access to superior back-end infrastructure, enable tie-ups with content producers and provide them access to latest business platforms to improve business efficiencies and deliver customer experience.
Jio aims to bring JioGigaFiber to more than 50 million homes across 1,100 Indian cities and towns, in the shortest possible time.
Reliance Jio announced the launch of its wired broadband service ‘JioGigaFiber’ to homes, merchants, small and medium enterprises and large enterprises in July this year.
These investments, Reliance claims, will give consumers in India access to best-in-class services at par with the rest of the world.
Jio has already started work on connecting 50 million homes across 1,100 cities. It will work together with Hathway and DEN and all the LCOs to offer a quick and affordable upgrade to a world-class lineup of JioGigaFiber and Jio Smart-Home Solutions to the 24 million existing cable connected homes of these companies across 750 cities.
“We are glad to join hands with Shri Rajan Raheja and Shri Sameer Manchanda, two of the pioneers in the MSO industry. Our investments in DEN and Hathway create a win-win-win outcome for the LCOs, customers, content producers and the eco-system. With Local Cable Operators now as part of the Jio ecosystem, we look forward to bringing Jio’s advanced JioGigaFiber and Smart Home Solutions to more Indian homes, even quicker. We look forward to welcoming other MSOs and LCOs to be part of this partnership,” Mukesh D. Ambani, Chairman and Managing Director, RIL said in a statement.