Telecom Market Poised in India and GTL Infrastructure Buys Anil Ambani's Phone Towers
GTL Infrastructure Ltd said it is willing to make further acquisition investments after purchasing Anil Ambani's mobile phone towers.
- (1888PressRelease) July 02, 2010 - According to the company, the continuing vigorous competition in the Indian telecoms sector is pushing the country's telecommunications industry towards consolidation.
Chairman GTL Infrastructure, Manoj Tirodkar, said that if any existing tower company seeks consolidation, and its business presents a viable opportunity, the company would consider it, adding that in the future, India may have just one or two tower companies due to consolidation. Tirodkar reiterated that the company's takeover of Reliance Communications (RCOM) Ltd's assets might result in a wave of similar mergers and subsequently stretch the acquisition records in the Indian Telecommunications Industry, currently the world's second biggest wireless market.
Major telecoms giants such the Emirates Telecommunications Corp. and Telstra Corp have hinted at investment plans in India. Currently, statistics estimate that the Indian mobile telephony sector is adding more customers every month than any other market in the world. According to analysts, there might be a shift in India's telecom operators deciding to prune their assets, putting towers and other telecom hardware in one entity. This would mark a good development for investors as it would result in a rise in telecom stocks across the board. To know more about the telecom sector of India, visit http://www.investinindia.com/industry/telecommunication.
With the acquisition of RCOM assets, GTL is poised to become the second biggest Indian tower company with a net enterprise worth of $11 billion upon conclusion of the deal, and saw its share trading in Mumbai surge by 20% after the announcement of the RCOM deal. GTL will most likely pay around $3.9 billion for RCOM's transmission towers, raising the cumulative value of deals in the Indian telecoms industry to around $20 billion, exceeding previous records set in 2005 by around 20%, said a Bloomberg estimate.
Anil's Reliance Communications said this month it may sell 26 percent stake to a strategic buyer or private equity firm. Mukesh Ambani's flagship Reliance Industries Ltd will make "mega" investments in power and telecommunications, the billionaire said June 18 at the company's shareholders' meeting. Reliance Industries, India's largest company by market value, agreed on June 11 to pay about $1 billion to buy Infotel Broadband Services Ltd. for the right to be India's only nationwide provider of wireless Internet services based on Wimax technology currently being rolled out in the U.S. and Japan. India had 601 million mobile-phone subscribers as of April, second only to China's 787 million.
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