Reliance Communication Chairman Anil Ambani announced that his company has "virtually" merged with Reliance Jio Infocomm, which is owned by his elder brother Mukesh Ambani.
Reliance Communication and Reliance Jio have agreements to trade and share spectrum. According to a report in the Economic Times, the two telecoms have synced their network operating centres, optic-fibre service contracts and network maintenance functions.
"As far as our 100 million customers are concerned, as far as our one million retailers are concerned, as far as our employees are concerned and as far as our vendors and partners are concerned, there is already been a virtual merger of the two organisations (RCom and Jio)," Ambani told shareholders at RCom's Annual General Meeting on Tuesday.
Following the announcement, the Reliance Communication stock was trading at Rs 48. 30 at around 11:08 a.m. on Wednesday, up 0.63 percent from its previous close. On the other hand shares of Reliance Industries (parent of Jio) were trading at Rs 1,092.35 apiece, down 1.63 percent on the BSE.
However, a Reliance group official later clarified that Anil Ambani was not hinting at any legal merger. "The two companies are not merging," the official told publications.
In other news, Reliance Communication and Reliance Jio among other telecom firms have been declared qualified to bid for airwaves during the upcoming spectrum auction. Reliance Jio can bid in any licensed service area across India, while Reliance Communication can bid anywhere except for the northeast region and Assam.
Reliance Jio has deposited the highest earnest money of Rs 6,500 crore.