PE firms call off talks to buy stake in RCom tower unit
29 May 2012
Private equity firms Blackstone and Carlyle Group have called off talks to buy majority stake in Reliance Communications' (RCom) telecom tower unit – Reliance Infratel – citing high valuations, according to reports.
Reliance was seeking a valuation of around Rs20,000 crore for its tower unit, which the PE firms felt was too high. This is cited as the reason for calling off the deal.
Reliance Infratel, which has about 50,000 towers, will now engage in a fresh round of discussions with investors. But the company refused to comment on the status of discussions with specific investors.
Reliance Communications, the country's second largest telecom operator, has been exploring various routes for raising funds, including selling a stake in Reliance Infratel, a move that will help it retire a major chunk of debt on its books.
Billionaire Anil Ambani-controlled Reliance Communications has spent a year looking for a buyer for its 95-per cent stake in its Reliance Infratel tower unit, as it struggles with its more than $7 billion net debt.
Separately in an analysts' call, Reliance Communications president Punit Garg said it was in talks with several potential investors for selling its tower unit, but a deal can be finalised after clarity on spectrum guidelines.
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