Reliance Industries Limited (RIL) is reportedly acquiring a controlling stake in GTPL Hathway, a leading multi-system-operator (MSO), dominating the market in Gujarat. The news follows RIL’s announcement to acquire a majority share in two of India’s largest broadband services and cable TV providers: DEN Networks and Hathway Cable & Datacom. With the addition of all three service providers to the stable, RIL is looking to increase the reach of its own broadband platform, Jio GigaFiber.
RIL Looking to Aquire More Regional MSOs
Reliance Industries has already invested over INR 4,500 crore in India’s major ISPs and it does not plan on stopping there. One of the people aware of the matter said, “After Hathway and DEN, RIL believes it makes sense to acquire strong regional MSOs, and GTPL is the first such company with strong financials and clean books.”
None of the companies involved in the matter were available to respond to the queries posed by reporters of The Economic Times who reported this story.
The person cited above, further said, “Already, because of Hathway, RIL has got almost 20 percent stake in the company. The talks are in the initial stages and the announcement will be after the open offer.” Abiding by the rules, Reliance Industries has put forth an open market offer announcing up to 25.64 percent share of Hathway at INR 82.65 per share. The total aggregates to a whopping INR 238.37 crore. This will further accelerate the efforts in the direction of connecting 50 million homes across 1,100 cities through the company’s ambitious Jio GigaFiber project.
One more person with the knowledge of the subject matter, cited, “Common understanding is that not many shareholders would want to subscribe to the open offer, especially, now that RIL is involved,” So, after the open offer, RIL will make the final offer to pick up a majority stake in GTPL Hathway.”
Currently, GTPL Hathway boasts an active subscriber base of 7.6 million in India. With over 4 million subscribers, the MSO holds over 67 percent market share in Gujarat. It ranks number two in West Bengal with a 24 percent market share. The MSO spreads over 500 cities in 11 states and operates with more than 20,000 local cable operators in India. As of June 2018, GTPL Hathway’s broadband subscriber base aggregated to a total of 290,000.
RIL’s Investment Will Benefit Jio GigaFiber
With a major strategic primary investment of INR 2,490 crore in Hathway Cable and Datacom Limited, and over INR 2,045 crore in Den Networks, Reliance Jio’s broadband service gets the push it needs to achieve the said target. Analysts suggest that the company’s association with the local service providers will prove fruitful. The open offers to the providers with remarkable local reach will work out in the favor of Jio GigaFiber, boosting the company’s overall digital activity. Jio GigaFiber will be able to make way to the consumers quickly, without having to waste the time in setting up the network.
During a press conference, RIL Chairman, Mukesh Ambani said, “Our investments in Den and Hathway create a win-win-win outcome for the Local Cable Operators (LCOs), customers, content producers, and the eco-system. With LCOs now as part of the Jio ecosystem, we look forward to bringing Jio’s advanced JioGigaFiber and Smart Home Solutions to more Indian homes, even quicker.”-mysmartprice