R-Comm spins off overseas arm, float likely soon
Reliance Anil Dhirubhai Ambani group company, Reliance Communications has consolidated its global telecom business under a new entity, Reliance Globalcom.
This entity will bring under a single umbrella services such as its global voice business (including international voice calls), managing networks for companies, Internet services and undersea cable systems that it owns under the FLAG brand.
Further, Reliance Globalcom's operations will be headquartered in London and will be headed by Punit Garg along with 1,000 employees.
With the consolidation, Reliance Globalcom expects revenues of Rs. 5,279 crore in 2007-08 and FLAG will be rebranded as Reliance FLAG. It has plans to plans of coming out with an IPO in the near future, according to Garg.
This consolidation is primarily due to the company's need to bring together Reliance Communications' different entities like its recent acquisition of Yipes Enterprise Services, FLAG and Reliance Communications' international business under a single company. "We would like to approach the global market as an end-to-end telecom service provider and offer a single face to clients," said Garg.
With this consolidation, Reliance Globalcom wants to push its network management services, which involves managing of companies' IT networks from its data centres located in Mumbai, Long Island and New York.
Last month, Reliance Communications announced capital expenditure for this year at Rs 24,000 crore. These investments would be made in emerging areas like the enterprise communications business, FLAG, and direct-to-home and Internet protocol television.
At that time chairman Anil Ambani added that decisions on various options for the future of the communications business would be evaluated.