Jio is looking to purchase 5G gear from the Swedish telecom giant Ericson and the loans would be use to fund this purchase
BNP Paribas will provide $1.9 Bn-$2 Bn over a nine-month period, during which Jio will pay back Ericsson, BNP and some other banks
The development comes after Jio tied up with EKN for a $2.2 Bn loan to finance the equipment and services for its 5G expansion
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Reliance Industries Ltd’s telecom arm Jio is reportedly in talks to raise up to $2 Bn in offshore loans, with BNP Paribas acting as lead arranger, to fund its 5G network expansion in the country.
The telecom giant is likely to purchase 5G gear from Swedish telecom giant Ericsson and the loans would be used to fund this purchase, ET reported citing sources.
Ericsson, in October last year, said its 5G Radio Access Network (RAN) products and solutions will be deployed for Jio’s 5G rollout in India.
BNP Paribas will provide $1.9 Bn-$2 Bn over a nine-month period, during which Akash Ambani-led Jio will pay back Ericsson, BNP and some other banks, the publication said citing a person familiar with the matter.
The report added that the fundraise is happening through a discounted process and the implicit interest rate will be arrived at over the nine-month period.
The development comes after Jio tied up with Swedish export credit agency EKN for a $2.2 Bn loan to finance the equipment and services for its 5G expansion. “The $2.2 Bn cover from EKN will likely reduce Jio’s overall 5G gear funding costs as global lenders and 5G equipment suppliers involved in such a large deal will be more comfortable,” another source was quoted as saying.
As per reports, Jio has also signed a deal with Nokia worth $1.7 Bn to purchase 5G gear.
Jio is the largest telecom operator in the country, with a market share of 38.35% in the Indian wireless market as of June 30, 2023.
During Reliance’s 46th annual general meeting (AGM), CMD Mukesh Ambani said Jio has surpassed the 450 Mn subscribers mark.
Jio’s 5G rollout is in its advanced stages and the company aims to achieve the nationwide rollout by the end of 2023. The telco’s 5G services are already available in 96% of census towns, Mukesh Ambani said at the AGM last month.
“Today, nearly 85% of the total 5G cells operational in India are in Jio’s Network. At our current pace, we are adding one 5G cell to our network every 10 seconds,” he said, adding that 1 Mn 5G cells are expected to be operational in Jio’s network by December.
Jio reported a consolidated net profit of INR 5,098 Cr in the Q1 FY24, up 12.5% year-on-year.
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