Take the pledge to vote

For a better tommorow#AajSawaroApnaKal
  • I agree to receive emails from News18

  • I promise to vote in this year's elections no matter what the odds are.
  • Please check above checkbox.

    SUBMIT

Thank you for
taking the pledge

Vote responsibly as each vote counts
and makes a diffrence

Disclaimer:

Issued in public interest by HDFC Life. HDFC Life Insurance Company Limited (Formerly HDFC Standard Life Insurance Company Limited) (“HDFC Life”). CIN: L65110MH2000PLC128245, IRDAI Reg. No. 101 . The name/letters "HDFC" in the name/logo of the company belongs to Housing Development Finance Corporation Limited ("HDFC Limited") and is used by HDFC Life under an agreement entered into with HDFC Limited. ARN EU/04/19/13618
LIVE TV DownloadNews18 App
News18 English
News18 » Business
3-min read

RIL to Set Up Subsidiary to Combine Digital Initiatives, Infuse Rs 1.08 Lakh Crore Equity

The new structure is similar to those adopted by global tech giants, and will offer a compelling investment proposition to strategic and financial investors, the company said in a statement, adding that this will also create the largest digital services platform company in India.

News18.com

Updated:October 26, 2019, 8:55 AM IST
facebookTwitter Pocket whatsapp
Addressing the Reliance Family Day event, Mukesh Ambani, Chairman, Reliance Industries Limited said the company owed all its progress to its founder Dhirubhai Ambani.
File photo of Reliance Industries Chairman Mukesh Ambani.

New Delhi: Reliance Industries Ltd on Friday announced that it is setting up a new subsidiary to bring all its digital initiatives under a single entity, infusing Rs 1.08 lakh crore equity into the new unit.

The new structure is similar to those adopted by global tech giants, and will offer a compelling investment proposition to strategic and financial investors, many of whom have evinced strong interest in partnership, the company said in a statement, adding that this will also create the largest digital services platform company in India.

The new entity will continue to work on technologies in areas like healthcare and education, while also looking at next-gen competencies like artificial intelligence, Blockchain, virtual and augmented reality, among others.

It will also bring into its fold Reliance's consumer-focussed digital offerings like MyJio, JioTV, JioCinema, JioNews and JioSaavn, while enabling Reliance Jio (RJIL) —its telecom arm — to become "virtually net debt free" by March 31, 2020 (excluding spectrum liabilities).

Under the new structure, RIL board has approved the formation of a wholly-owned subsidiary (WOS) for digital initiatives, and an investment of Rs 1.08 lakh crore in the said unit through optionally convertible preference shares (OCPS), the statement said. The WOS will also acquire RIL's equity investment of Rs 65,000 crore in RJIL, it added.

At the same time, the board of RJIL has approved a scheme between the company and certain classes of its creditors, including debenture holders, for transfer of identified liabilities of up to Rs 1.08 lakh crore to RIL.

RJIL board has also approved a rights issue of OCPS of up to Rs 1.08 lakh crore and the new digital subsidiary will subscribe to this issue. This will enable Reliance Jio to become "virtually net debt free company by March 31, 2020, with exception of spectrum related liabilities", the statement said.

The total capitalisation in digital platform services will be at Rs 1.73 lakh crore (including the existing Rs 65,000 crore). The proposed consolidated structure will be compliant with all statutory requirements, it noted.

"This new company will be a truly transformational and disruptive digital services platform. It will bring together India's No 1 connectivity platform, leading digital app ecosystem and world's best tech capabilities globally, to create a truly Digital Society for each Indian," RIL Chairman and Managing Director Mukesh Ambani said.

He added that given the reach and scale of its digital ecosystem, the company has received strong interest from potential strategic partners. "We will induct the right partners in our platform company, creating and unlocking meaningful value for RIL shareholders," he added.

So far, RJIL was a subsidiary of RIL. RIL group also had various other digital initiatives like MyJio, JioTV, JioCinema, JioNews, JioSaavn as well as emerging platforms in healthcare and education.

With this move, all of these digital initiatives will get streamlined under one roof, enabling early monetisation opportunities.

The statement on Friday said there will be no impact in the value -- pre and post the re-organisation for any shareholder, or on the consolidated debt of RIL. It added that the move will not affect RIL's standalone credit profile, given its robust cash flows and conservative leverage, while ensuring that monetisation opportunities accrue to shareholders.

The statement pointed out that assets worth about Rs 1.25 lakh crore were demerged from RJIL in March this year to Infrastructure Investment Trusts (InvITs) aimed at optimising operational efficiencies and better monetisation of core digital connectivity platform, tower and fibre passive infrastructure. Post the demerger, RJIL had become asset light with a balance sheet of Rs 2.37 lakh crore, the statement noted.

Reliance Jio is the second largest single-country operator globally, with 355 million subscribers. It claimed that its wireless network carries more than 400 crore GB worth of data per month, and nearly 1,000 crore voice minutes per day.

Disclaimer: News18.com is part of Network18 Media & Investment Limited which is owned by Reliance Industries Limited that also owns Reliance Jio

Get the best of News18 delivered to your inbox - subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, Telegram, TikTok and on YouTube, and stay in the know with what's happening in the world around you – in real time.

Read full article
Next Story
Next Story

facebookTwitter Pocket whatsapp
Most Active
Company Price Change %Gain
Yes Bank 73.00 5.87
Indiabulls Hsg 238.55 -1.28
ICICI Bank 496.80 1.50
HDFC Bank 1,264.75 0.73
Reliance 1,427.80 -1.22
Company Price Change %Gain
Yes Bank 73.00 5.80
Indiabulls Hsg 238.35 -1.43
Tata Power 57.30 -3.70
IRCTC 932.80 6.33
RBL Bank 343.40 6.02
Top Gainers
Company Price Change %Gain
Zee Entertain 305.40 6.23
Yes Bank 73.00 5.87
BPCL 517.60 2.95
GAIL 130.35 2.60
Tata Motors 172.00 1.75
Company Price Change %Gain
Yes Bank 73.00 5.80
Tata Motors 172.00 1.68
ICICI Bank 496.95 1.53
IndusInd Bank 1,444.90 1.50
Axis Bank 733.60 1.12
Top Losers
Company Price Change %Gain
Nestle 14,108.45 -2.51
Hero Motocorp 2,594.00 -2.00
Hindalco 200.15 -1.82
Vedanta 152.70 -1.80
Cipla 454.85 -1.65
Company Price Change %Gain
Hero Motocorp 2,593.15 -2.00
Vedanta 152.55 -1.90
TCS 2,099.70 -1.42
Reliance 1,427.80 -1.21
Asian Paints 1,773.80 -1.16

Live TV

Countdown To Elections Results
To Assembly Elections 2018 Results