Mumbai: The World Bank’s investment arm International Finance Corp. (IFC) has led a round to invest $45 million in Mumbai-based broadband service provider Tikona Digital Networks Pvt. Ltd.
IFC and the existing investors have invested $25 million and the rest has been put in by funds managed by Goldman Sachs Asset Management, Oak Investment partners, Everstone Capital and L&T Infrastructure Finance Co. Ltd. Tikona will use the capital for its expansion in Mumbai and other cities.
On 4 September, the government allowed Tikona to raise Rs.250 crore through an equity sale to raise foreign equity participation in the firm to 73.76% from the earlier 72.58%.
“We are pleased to have IFC as an investor given their understanding of the broadband sector across the globe and long term approach to business investments. Additional capital from our existing investors is also a strong endorsement of their faith in the strength of our business,” said Prakash Bajpai, chief executive officer and managing director of Tikona.
“IFC’s investment in Tikona will facilitate expansion of broadband infrastructure to middle income households and small and medium businesses, particularly in priority states of Madhya Pradesh, Chhattisgarh, Rajasthan and Uttar Pradesh,” said Ruchira Shukla, south Asia lead for technology, media and telecom investments at IFC.
Tikona aims to build a services framework that can deliver voice, video, information technology (IT) applications and multimedia content services over any broadband network.
Tikona serves the home broadband market in the country. Tikona also owns 20 megahertz (MHz), 4G (fourth generation) spectrum in the 2,300 MHz band in five telecom circles—Gujarat, Uttar Pradesh, Rajasthan and Himachal Pradesh—covering 28% of the population of India, positioning it well to offer 4G data services in the future.