RCom plans to shut down DTH arm business

Anil Ambani owned Reliance Communications is planning to shut down its DTH arm business Reliance Digital TV with effect from November 18.

"The reason behind the decision is the expiry of its DTH license, and the company is not looking to renew it, " RCOM said.

Reliance Digital TV informs its customers that due to the expiry of our license we will be shutting down our DTH services across India wef 18 November. Customers are advised to make alternative arrangements to keep watching their favorite TV channels. We regret the inconvenience caused," Reliance Big TV said in a notice.

Meanwhile, the company recently informed that it has received the Department of Telecommunication's (DoT) approval for the demerger of the wireless business of
Sistema Shyam Teleservices Limited (SSTL) into RCOM.

With this, RCOM will acquire approximately 2 million customers and additional annual revenues of around Rs 700 crore.

In addition, RCOM will acquire 30 MHz of the most valuable and superior 800 / 850 MHz band spectrum, ideally suited for 4G LTE services, to complement its own unique nationwide footprint.

This will result in the extension of the validity of RCOM's spectrum portfolio in the 800 / 850 MHz band in eight important Circles (Delhi, Gujarat, Tamil Nadu, Karnataka, Kerala, Kolkata, UP-West and West Bengal) by a period of 12 years-from 2021 to 2033.

As a result of the demerger, SSTL will receive a 10 percent equity stake in the fully diluted equity share capital of RCOM.

In addition, RCOM will assume the liability to pay the DoT installments for SSTL's spectrum, amounting to Rs 390 crore per annum for the next 8 years.

The closure of the transaction is expected by the first week of November 2017