Reliance Jio Might Not Able To Copy Indian Success In Europe: Here's Why

RIL is expanding its reach to other European countries as it is reportedly bidding for a subsidiary of Deutsche Telekom AG, T-Mobile Netherlands BV. However, brokerage firm UBS believes that Reliance Industries might not be able to copy the same success of its telecom services in Europe.

RIL Might Not Get Benefit In Europe

The brokerage firm added that Reliance Jio benefitted in India because of unique circumstances, but it is not necessary that it will get the same success in Europe.

"RIL has not previously indicated any intention to expand into Europe and has always remained more focused on domestic expansion," UBS said. It added that "A diversified conglomerate with significant investments in other industries such oil, chemicals, and retail."

RIL is reportedly evaluating T-Mobile offer Netherlands BV, where Deutsche Telecom's Dutch arm is looking for close to $5.9 billion. However, sources close to the development said that "It's highly unlikely that RIL will splurge such huge sums in an overseas M&A when the conglomerate's prime target market remains India".

For the unaware, Deutsche Telekom is also working with Morgan Stanley as it wants to sell its business, which has attracted several companies like Warburg Pincus, Apax Partners, Apollo Global Management Inc, BC Partners, and Providence Equity Partners reported Bloomberg News.

Reliance Jio Largest Telecom Operator In India

It is important to note that Reliance Jio is leading the Indian telecom sector with a 37 percent market share. It is providing its services to 441 million users despite launching its services in September 2016, which means the telecom operator is only five years old.

The company has managed to attract such a huge user base due to free offers and affordable tariff packs. However, the brokerage firm added that RIL bidding for T-Mobile might be not good for the Dutch and European telecom industry.

As we all know that Reliance Jio is known for disrupting the telecom sector, so there are high chances that it might be adopted easily in other countries, but still, one should not forget that every country has different rules and regulations for the telecom sector. So, it would be interesting to see that how RIL will close this deal.