Troubled Indian operator Reliance Communications looks likely to leave the market entirely after receiving two bids of $1.1 billion for its available telecoms assets.
According to the Financial Times, the interested parties are I Squared Capital and a consortium that includes The Blackstone Group, TPG Capital and Varde Partners. RCom is looking to sell off its Indian data centres and fixed-line infrastructure, as well as its international submarine cable operations, as it struggles to avoid being pushed into insolvency proceedings.
In February, RCom reached an agreement to sell its wireless and fibre infrastructure to Reliance Jio in order to lower its debt burden, and recently received clearance to do so from India’s Supreme Court. However, the INR250 billion ($3.6 billion) deal stalled when Ericsson took legal action against the operator over an unpaid debt. The dispute has now been resolved, allowing the Jio deal to go ahead.
RCom’s decision to sell some of its more valuable telecoms assets to Jio was primarily aimed at lowering its INR450 million debt, but the operator had planned to remain a player in enterprise telecoms. However, after its remaining assets attracted the interest of five potential buyers, it is now considering pulling out of the telecoms sector after 15 years.
In around March this year, I Squared Capital was reportedly the forerunner to acquire RCom’s remaining assets. However, the delay to Jio’s acquisition caused by the dispute with Ericsson created an opportunity for the consortium to express an interest.