RCom stake fray hots up with AT&T
The race to buy a large stake in Reliance Communications (RCom), India’s second largest private telecom service provider, is hotting up with US-based AT&T joining the fray, reports HT Correspondent.business Updated: Jun 08, 2010 02:13 IST
The race to buy a large stake in Reliance Communications (RCom), India’s second largest private telecom service provider, is hotting up with US-based AT&T joining the fray.
While the Wall Street Journal, citing people familiar with the matter, reported the entry of the telecom titan, it could not be confirmed independently. But is clear after RCom’s board approved a 26 per cent stake sale at the weekend that a keen race is likely to grab a seat in the world’s fastest growing telecom market.
UAE’s Etisalat has already confirmed talks with RCom, while South Africa’s MTN is still being named as a key contender.
RCom’s board approved the stake sale “at an appropriate premium to the prevailing market price” while keeping options open on strategic partnerships.
If the deal happens, then it will be AT&T’s second entry into the Indian telecom market. The company earlier exited Indian market by selling its 33 per cent stake in Idea Cellular in 2005, following its merger with Cingular Wireless.
AT&T had then got only $250 million for its Idea stake, and missed on the market boom that followed in the subsequent years.
“If AT&T wants to enter into India, which is the fastest growing telecom market in the world, RCom provides good opportunity as it owns spectrum for GSM, CDMA and 3G,” said B K Syngal, a former chairman of Reliance Telecom, which marked the first venture of the Reliance group into telecom sector.