RCom said to be close to sale of tower unit

25 Nov 2015
Daily News

India's telecom industry could soon see some substantial M&A activity, with Reliance Communications reportedly planning to divest its tower business while Videocon Industries pursues a sale of its telecom business.

Reliance Communications (RCom) is closing in on a deal to sell its 96% stake in Reliance Infratel, sources told India's Economic Times.

A deal could be announced this week that would value Infratel at around 220 billion rupees ($3.32 billion), which would help RCom substantially reduce its debt burden of 380 billion rupees.

According to the report, some bidders are pursuing a purchase of RCom's entire stake in the tower business but two others are seeking only a 51% stake. RCom would prefer a complete exit.

The Economic Times separately quotes two sources as stating that Videocon Industries is close to a deal to sell its telecom business, with Idea Cellular emerging as a frontrunner for the purchase.

Videocon has operating licenses in six circles covering the 1800-MHz band, and Idea could use the spectrum to fulfil its ambitions of entering the 4G market.

Videocon first entered the telecom sector in 2008, but lost its license in 2012 due to the court decision to terminate 122 circle-specific licenses issued by the nation's former telecom minister. The company subsequently bid for and won 1800-MHz spectrum in six circles.

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