VSNL buys Dishnet''s net business
By Mumbai: | 20 Mar 2004
Mumbai: Videsh Sanchar Nigam Ltd has reached an agreement with DishnetDSL to acquire the Internet businesses of the Sterling Infotech group company for Rs 270 crore.
This will give VSNL access to the base of over 600 owned and franchised cybercafes of Dishnet. The latter's 20 dial-up locations are not among VSNL's existing 30 locations of operation, according to a press release from VSNL.
The acquired broadband assets have the capacity to service more than 50,000 customers in key cities in the country. VSNL currently has 6.5 lakh dial-up ISP customers.
"The acquisition will strategically help VSNL consolidate its presence in the Internet space under the Tata Indicom banner by enlarging its geographical footprint and giving it a head start in the broadband Internet space," said Mr N Srinath, Director, Operations, VSNL.
VSNL described the transaction as a `slump sale' — a spokesperson for the company said this is sale in which the acquirer company picks what it wants, (usually the assets and not the liabilities) of the selling company.
The agreement is for both the narrowband and broadband businesses of Dishnet DSL, said a news release from VSNL. The transaction includes all the Internet assets, employees and customers of Dishnet's ISP division.