The ailing Reliance Communications, which could not finalize a merger deal with Maxis-owned Aircel, is likely to end its telecom services across India.
Reliance Communications (RCOM) is likely to follow the footsteps of its CDMA rival Tata Teleservices (TTSL). TTSL will be selling its mobility phone business to Airtel for no returns. The no-cash transfer of the mobile services to Airtel will not impact the consumers of Tata Docomo.
Some media reports say Reliance Communications, a telecom operator promoted by Anil Ambani, will stop 2G services and will try to continue 3G and 4G services focusing on data business.
The negative impact of Reliance Jio forced Reliance Communications to settle with nearly 82 million wireless subscribers in India. The decision of Reliance Communications to suspend the operations will impact its telecom and DTH customers in India. Reliance Communications is still looking for a buyer for its tower business.
Reliance Communications, which started telecom operations before the split of Anil Ambani and Mukesh Ambani, has around Rs 47,000 crore debt. The deal with Aircel was aimed at reducing RCOM debt by INR 20,000 crore or $3 billion or over 40 percent of total debt.
Reliance Communications, in fact, was one of the dream projects of Dhirubhai Ambani, the late father of Anil Ambani and Mukesh Ambani.
Several telecom equipment makers and telecom tower companies are eagerly waiting for the revival of Reliance Communications. According to industry reports, Reliance Communications is not in a position to make payment to its suppliers. Reliance Communications employees will also be in a major trouble due to the recent consolidation.
Reliance Communications could not complete the merger of its mobile business with Aircel, which is now looking for a buyer. Industry experts speculate that Sunil Mittal, the promoter of Bharti Airtel, could look at both Reliance Communications and Aircel.
Airtel signed deals with Telenor India and Tata Teleservices without spending any money to grab spectrum and subscribers.
Reliance Communications in a February 2017 presentation to analysts said it has nearly 87 million wireless subscribers including 32 million data subscribers. 23 million subscribers are on 3G / 4G network.
Reliance Communications has pop coverage ~80 percent in 18,000 cities and 2,00,000 villages. The telecom operator has a network with macro cells and small cells, and IBS backed by fiber network over 250,000 Kms across India.