RCom said to split GSM, CDMA businesses

Dylan Bushell-Embling
14 Jan 2014

India's Reliance Communications (RCom) is reportedly in the process of splitting up its GSM and CDMA mobile units, as part of its latest restructuring effort.

The nation's fourth largest telecom operator may eventually seek to sell off its lagging CDMA business, people close to the company told the Times of India.

RCom started out life as a CDMA operator, but introduced GSM services after operators were cleared to offer both technologies in 2008. Around 80% of India's mobile subscribers use GSM services, and 20% use CDMA.

RCom's CDMA business is a drain on the company's finances, and a sale could go some way towards helping the company pare down its roughly 411 billion rupee ($6.7 billion) debt pile.

According to the Times, the restructuring is also aimed at splitting management of the company along the lines of India's 22 telecom circles, in order to ensure that RCom is free to implement region-specific strategies.

Individual circles will be able to run their own sales, network and support departments.

Attempts to sell RCom's CDMA business would likely emphasize the company's spectrum and related assets, the sources added.

RCom's potential CDMA unit sale isn't the only deal in the offing with the potential to shake up India's mobile sector. Vodafone is reportedly considering making a bid to acquire Tata Teleservices and merge it with Vodafone India, in an acquisition which would create India's largest mobile operator.

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