Mumbai-based broadband services provider Tikona Digital Networks Pvt Ltd has raised $45 million in a fresh round led by World Bank’s private sector investment arm International Finance Corporation (IFC) with participation of its existing investors, the company said in a release.
The company received FIPB’s nod in September this year for the proposed funding.
IFC has brought in $25 million as disclosed early this year and the rest $20 million was invested by Goldman Sachs Asset Management, Oak Investment partners, Everstone Capital and L&T Infrastructure Finance Co Ltd collectively.
Founded by a team of telecom professionals led by chief executive Prakash Bajpai, Tikona had raised Rs 237.26 crore from the private investors in 2009.
Tikona Digital will use the funding to expand its broadband network in existing and new cities.
“We are pleased to have IFC as an investor given their understanding of the broadband sector across the globe and long-term approach to business investments. Additional capital from our existing investors is also a strong endorsement of their faith in the strength of our business,” said Prakash Bajpai, CEO and MD, Tikona.
Founded in 2008, Tikona Digital (formerly known as HCL Infinet) is serving over 225,000 homes in the top 25 cities of India. The company currently has licence to use 20 MHz of spectrum in the 2.3 Ghz band in five circles—Gujarat, Rajasthan, Himachal Pradesh, Uttar Pradesh, (East) and Uttar Pradesh (West).
“A well penetrated, high-quality broadband infrastructure will provide impetus to growth in India in the areas of communication, commerce, e-governance, information, education, healthcare and job creation. IFC’s investment in Tikona will facilitate expansion of broadband infrastructure to middle income households and small and medium businesses, particularly in priority states of Madhya Pradesh, Chhattisgarh, Rajasthan and Uttar Pradesh,” said Ruchira Shukla, South Asia lead for TMT investments at IFC.
This is the second investment by IFC in the TMT sector in this year. In September, it invested Rs 389 crore (around $65 million) to pick 0.8 per cent stake in cellular services provider Idea Cellular Limited. The investment was through a participation in a qualified institutional placement (QIP).
(Edited by Joby Puthuparampil Johnson)