Reliance Communications (RCom) has rallied over 6% to Rs 144 in otherwise weak market after the telecom services provider said that its board of directors had given in-principle approval to demerger of the company’s real estate assets into a separate company.
A new company, to be called Reliance Properties Ltd (RPL), would be spun off to unlock value, RCom said in a BSE filing.
The proposed separation of real estate into a separate unit is part of RCom’s strategic plan to divest non-core assets, and focus on its core wireless and enterprise business, it added.
The company said that the preliminary and indicative monetisable value of RCom’s real estate on development is estimated by independent valuers at over Rs 12,000 crore ($ 2 billion), which is equal to Rs 60 ($ 1) per RCom share.
The new entity will be listed separately and the existing shareholders will get one RPL share for each RCom share held. The demerger is expected to enhance value for the existing shareholders.
The stock opened at Rs 138 and hit a high of Rs 148 on BSE. A combined around 10.86 million shares have changed hands on the counter so far on BSE and NSE. The benchmark Sensex is down 1.17% or 229 points at 19,495 at 0935 hours.
A new company, to be called Reliance Properties Ltd (RPL), would be spun off to unlock value, RCom said in a BSE filing.
The proposed separation of real estate into a separate unit is part of RCom’s strategic plan to divest non-core assets, and focus on its core wireless and enterprise business, it added.
The company said that the preliminary and indicative monetisable value of RCom’s real estate on development is estimated by independent valuers at over Rs 12,000 crore ($ 2 billion), which is equal to Rs 60 ($ 1) per RCom share.
The new entity will be listed separately and the existing shareholders will get one RPL share for each RCom share held. The demerger is expected to enhance value for the existing shareholders.
The stock opened at Rs 138 and hit a high of Rs 148 on BSE. A combined around 10.86 million shares have changed hands on the counter so far on BSE and NSE. The benchmark Sensex is down 1.17% or 229 points at 19,495 at 0935 hours.
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