GTL Infra Abandons RCom DealBy Arnab Ghosh, Gaea News Network
Monday, September 6, 2010
DELHI, INDIA (GaeaTimes.com)- Reliance Communications led by Indian Billionaire Anil Ambani has announced that it is walking out of the unification of its telecom tower business with GTL Infra. The company will now search for other interested investors. Had the deal been executed according to the earlier plans, it would have resulted in the creation of the second-largest mobile-phone tower operator in India. The previous non binding agreement ended in June and none of the companies showed any interest in renewing or extending the deadline. Reliance, as per the industry buzz has started approaching the potential investors. It reportedly has also started mulling about an IPO.
The telecom market veterans are of the opinion that the deal with GTL Infra would have been beneficial for Reliance Communication. The stocks of both the companies nosedived as a result of the failure of the deal in Mumbai trading. The GTL spokespersons refused to remark on the development and the causes behind it. It was supposed to purchase as many as 50,000 transmission towers from the Anil Ambani led R Com group in exchange of stock and cash. RCom on its part also refused to specify a reason for walking out of the merger deal with GTL Infra.
The proposal to merge GTL Infra with RCom came in June this year and it created sufficient buzz in the telecom industry in India. The tower sale would have helped RCom to reduce debt and get an edge over its rivals in the market. The next partner eyed by Reliance is not known but there is a buzz that some overseas company may be one of the suitors.
Tags: Anil Ambani, Delhi, GTL Infra, India, Reliance Communications