RIL to infuse Rs. 1 lakh crore in new Digital subsidiary, to make Jio debt free by March 2020

Mumbai : The Board of Directors of Mukesh Ambani controlled Reliance Industries ltd (RIL) has cleared the formation of a wholly-owned subsidiary for Digital Platform initiatives and investment of Rs. 1,08,000 crore in the WOS through OCPS. The subsidiary will also acquire RIL’s equity investment of Rs. 65,000 crore in Reliance Jio Infocom ltd (RJIL).

“The Board of Directors of RJIL has approved a scheme of arrangement between RJIL and certain classes of its creditors including debenture holders for transfer of identified liabilities of up to Rs. 1,08,000 crore to RIL. It has also approved a proposal of rights Issue of Optionally Convertible Preference Shares (‘OCPS’) aggregating up to Rs. 1,08,000 crore for the purpose of payment of consideration for transfer of identified liabilities – WOS to subscribe to this issue” RIL said in a regulatory filing.

“Consequent to the above, RJIL will become virtually net debt free company by 31st March 2020, with exception of spectrum related liabilities. Like global technology peers, the Digital Platform Company with negligible leverage makes a compelling investment proposition for both strategic and financial investors, many of whom have evinced strong interest in partnering with us. It will have significant financial strength to address the Digital Services opportunity in India” RIL said.