Reliance Communications (RCom) attracted two bids worth a reported $1.1 billion for its remaining telecoms assets, as the company nears a full withdrawal from the market.
Financial Times reported the troubled company is in discussions with a consortium comprised of TPG Capital, The Blackstone Group and Varde Partners; as well as I Squared Capital about the sale of its international submarine cable network; remaining fixed-line infrastructure; and data centres. Both bids valued the assets at $1.1 billion.
News of discussions come soon after India’s Supreme Court cleared RCom to proceed with a INR250 billion ($3.6 billion) sale of its wireless and fibre assets to Reliance Jio, which had been held up due to a legal dispute with Ericsson which has now been settled.
RCom agreed to the deal with Jio in February to reduce a debt load of around INR450 million, but the company was expected to remain in the telecoms market after the sale completed, positioning its remaining business towards serving corporate customers.
However, FT reported in March the company had changed strategy and was considering ending its 15-year stay in the sector, with five companies interested in acquiring the remaining assets, or a subset of assets.
FT said the latest sale is RCom’s last bid to avoid being forced into insolvency proceedings, as it struggles to cope with its debt load. The settlement with Ericsson had allowed it to also proceed with the sale of its remaining assets.
Sources said I Squared, which in 2017 acquired CK Hutchison’s fixed-line business for $1.9 billion, had been in pole position to secure RCom’s assets. However, the hold up due to to Ericsson’s intervention opened the door for the TPG Capital consortium.
PCCW and Russia-based Sistema have also been linked to acquiring the remaining assets in the past.
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