RCom confident of selling stake in tower arm soon
31 May 2011
The debt-ridden Reliance Communications said today that it has received several expressions of interest to buy a controlling stake in its telecom tower unit, Reliance Infratel.
India's second-biggest mobile phone service provider did not name the interested parties, but said in a statement the company's board had approved taking the process to the next stage of due diligence. It said it aimed to complete a deal at the earliest.
A sale will help the Anil Ambani-controlled RCom reduce its debt, which was Rs32,049 crore ($7.1 billion) as of 31 March. It has so far been unsuccessful in its other attempts to raise funds.
Last year the company had almost finalised an agreement to spin off Reliance Infratel into a joint venture with GTL infrastructure. But the deal fell through for unknown reasons.
A separate plan to sell up to 26 per cent in Reliance Com, announced in June last year, has not seen any takers yet.
A senior Reliance Comm executive told analysts on a conference call on Monday, while announcing the company's results for the January-March quarter, that "strategic initiatives" were under way to reduce the company's debt.