Reliance Communications (RCom) has signed a telecom infrastructure sharing agreement with S Tel, the new telecom operator. The deal, which covers telecom towers, transmission and fibre backbone, will be executed by RCom through its tower subsidiary, Reliance Infratel.
The companies did not disclose the size of the deal. Industry sources say it is around Rs 1,000 crore spread over 10 years.
The agreement covers six circles — Orissa, Bihar, Himachal Pradesh, North East, Assam and Jammu & Kashmir — where S Tel plans to roll out its GSM services by the end of this year.
S Tel is a joint venture company between Sterling Infotech Group (holding a 57.3 per cent stake) and Bahrain Telecommunications Company (42.7 per cent). It holds a licence and spectrum in these six circles.
“This significant development is part of our overall commitment to provide customers with excellent quality of service and a wide geographical coverage at the time of launch. It is well established that improving teledensity provides more economic benefit than any other kind of infrastructure. This move will enhance the mobile penetration in these circles and rapidly bring benefits of technology and communication networks to people in these regions,” S Tel CEO Shamik Das said.
According to the agreement, S Tel will get access to Reliance Infratel’s 10,000 sites and optic cable fibre backbone.
“This (agreement) will ensure a faster rollout, optimum costs and a time to market advantage," said Reliance Infratel President Inder Bajaj.