In a bid to jump-start its cable and broadband business, Mukesh Ambani-led Reliance is planning to acquire India largest cable operator, Hathway Cable, and Datacom.
Reliance is aggressively pursuing Hathway deal. The talks are in the exploratory stage, where valuation and business opportunity of the deal were discussed, said three people aware of the development.
Hathway valuation is reported to be around Rs 2500 crore.
Promoted by the Raheja Group, who owns 43 per cent stake in the firm, Hathway is considered one of the largest cable broadband service providers. It has 11 million digital cable TV subscribers and 800,000 broadband users, out of which 90 per cent users have high-speed (over 40 Mbps) plans.
If the deal goes through, Reliance last mile connectivity issue would be almost resolved as it would leverage the customer base of Hathway. Hathway’s average revenue per user for broadband business was around Rs 710 per month.
Reliance is aggressively planning to disrupt cable and broadband space.
On August 15, Reliance kicked off registrations for Jio GigaFiber. The company claims to have received a good response from some 900 cities and towns.
The company is eyeing to commercially launch Jio Giga Fiber, which includes high-speed, wired, broadband service bundled with an internet-based television programme, in tier-1 and 2 cities.
Meanwhile, local cable operators had expressed their worries following Reliance announcement to foray in the segment. Cable operators are into the business for the last 2-3 decades and would face threat from Reliance, which has a deep pocket to survive in the market.
According to cable operators, Reliance move to do the last mile connectivity on its own has caused an alarming situation among the cable operators. Instead of partnering with cable operators, Reliance Jio is directly approaching housing societies and resident welfare associations (RWAs) to pitch the company’s home broadband services.
Earlier, Reliance had held talks to acquire DEN networks last year. However, the deal could not fructify.
The development was reported by ET.