Anil shuffles his telecom pack
Is Anil Ambani planning to set up separate entities for domestic and international operations of his telecom services empire? Industry sources said promoters of RCom plan to consider divesting a significant stake in Reliance Telecom Ltd (RTL), a 100 pc subsidiary of RCom that operates in some regional telecom zones. Juggling the assetsbusiness Updated: Jun 07, 2010 00:30 IST
Is Anil Ambani planning to set up separate entities for domestic and international operations of his telecom services empire? Industry sources said promoters of Reliance Communications (RCom) plan to consider divesting a significant stake in Reliance Telecom Ltd (RTL), a 100 per cent subsidiary of RCom that operates in some regional telecom zones.
Cash-short RCom is under financial pressure on account of its impending expansion in 3G services and has also proposed expansion into broadband wireless access services.
RTL is an unlisted entity that is offering global system of mobile (GSM) services. It has licence for offering services in Madhya Pradesh, Himachal Pradesh, Bihar, Orissa, West Bengal , Kolkata and the North East.
RCom has acquired 3G spectrum through RTL and industry sources said that there was a strong likelihood that a strategic partner from overseas would be inducted into RTL, which will then concentrate on only domestic services as a separate entity.
The flagship listed firm, RCom, could end up forming a joint venture with a foreign giant that would concentrate on operations in new growth areas such as Africa. RCom officials refused to comment on the matter. Speculation in the market has centred around RCom going for a joint venture with South Africa's MTN, while UAE's Etisalat has been mentioned as a stake buyer.
Sources said Etisalat might consider buying equity in Reliance Telecom to ease the financial burden on RCom. However, it could not be confirmed. On May 31, RCom paid Rs 8,585 crore through its subsidiary Reliance Telecom to buy 3G spectrum. Sources said it would require another more than Rs 8,000 crore to roll out a 3G network.
The company is also a bidder for BWA spectrum for which auction is currently going on. On Saturday, the bids for one slot of pan India BWA spectrum crossed Rs 9,800 crore. If RCOM emerges as successful bidder in some of the circles, then it will require additional funding depending on the circles it wins.