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Telecom sector to see more mergers(Mail Today (India) Via Acquire Media NewsEdge) MORE consolidations are expected in India's telecom industry as the Anil Ambani- run Reliance Communications ( RCom) is likely to offer a 26 per cent stake to a strategic partner. Also, the Dhoot family- managed Videocon Telecommunications is looking to bring in a partner. This week, the board of directors at RCom approved in- principle the induction of strategic private equity investors into the company for an up to 26 per cent equity stake at an appropriate premium to the prevailing market price. The company has stated that it will also examine and pursue other appropriate strategic combination or consolidation opportunities. Although the company did not mention the names of the strategic investors that it had in mind, sources said RCom is in talks with cash- rich Etisalat Emirates Telecommunications Corp ( Etisalat). Videocon group chairman and managing director ( CMD) V. N. Dhoot has gone on record to state that the company is evaluating proposals from global communications firms for a strategic partnership. There have also been reports in sections of the media that South Korea's largest phone company S. K. Telecom was interested in a stake in Videocon and had initiated talks with the Dhoot family. However, the Korean company on Friday said these reports were " not true". A spokeswoman of S. K. Telecom said the company had not held any talks with the Indian company and these reports were mere " market rumours." Videocon has also been linked to Reliance Industries Ltd ( RIL) but with the Mukesh Ambani- managed company having acquired Infotel it remains to be seen whether Videocon is still on its radar. Videocon, earlier called Datacom, was involved in a bitter dispute with its minority shareholder HFCL's chairman Mahendra Nahata. The dispute was settled earlier this year after the Videocon bought out Nahata's stake in Datacom and renamed the firm Videocon Telecommunications. Videocon launched mobile services in Tamil Nadu, Gujarat and Mumbai in March this year and said it would soon expand operations to all 22 circles. According to Naveen Mishra, telecoms analyst with IDC India, the results of the BWA auction pointed to a ' high cost- high tariff' regime in the near term as operators would likely try to recover their investments in the shortest timeframe. (c) 2009 India Today Group. All Rights Reserved. Provided by Syndigate.info an Albawaba.com company |