BackTPG said to disagree with Anil Ambani over wireless tower value
Buyout group signals they view Reliance's assets as worth about Rs15,000 crore, including debt, down from
Premium
A buyout group, including TPG Capital, which is bidding for Anil Ambani-led Reliance Group’s wireless tower business has valued the assets more than a quarter below an initial estimate, people with knowledge of the matter said.
TPG and Tillman Global Holdings LLC have signalled that they view the assets as worth about ₹ 15,000 crore, including debt, after conducting due diligence on Reliance Communications Ltd’s tower assets, down from the ₹ 21,500 crore proposed earlier in the negotiations, according to the people. There’s no certainty the talks will result in an agreement, the people said, asking not to be identified as the information is private.
Reliance Communications said that the bidders have not reduced the enterprise value for the tower business by that amount.
“The valuation being discussed for monetization of our tower business is in line with recent comparable transactions," Reliance Communications said in an emailed response.
The firms are also considering scrapping a separate proposed purchase of Reliance Communications’ domestic fiber-optic assets, according to the people. The company was seeking a valuation of at least ₹ 80 billion for the backbone network, the people said.
Reliance Communications said in the email that the sale of the fiber-optic business “would be explored in a separate and independent transaction after the towers deal is finalized".
The reduced offer, which would still be the biggest private-equity deal in India, is a setback for Ambani’s Reliance Group, whose net debt stood at ₹ 404.8 billion at the end of last year, company filings show.
The company wants to reduce debt by no less than ₹ 300 billion, it said in the email.
Tillman founder Sanjiv Ahuja didn’t immediately respond to an email seeking comment, while Luke Barrett, a spokesman for TPG, declined to comment. Bloomberg
Devin Banerjee contributed to this story.
Reliance Group companies have sued HT Media Ltd, Mint’s publisher, and nine others in the Bombay High court over a 2 October 2014 front-page story that they have disputed. HT Media is contesting the case.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
