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Reliance Communications is reportedly gearing up to sell its undersea fibre optic cable network, as well as its US network business, in a deal worth around $3 billion.
Citing three separate sources from within the global network cables industry, Reuters has reported that the Indian company is keen to use the sale of its FLAG network to raise some cash to ease its debts.
Should the deal go ahead as expected, it would represent a significant profit for Reliance, which acquired the network for just $207 million back in 2003, since when it has become a platform for the company to sell unified networking capacity and other telecoms services to a number of other operators around the world.
"They have very few choices to raise funds," Hitesh Kuvelkar, research head at brokerage First Global, explained to the news agency.
"Their capex requirement for expanding their GSM network is huge and they have to raise that from somewhere."
However, Reliance has so far declined to confirm the speculation.
The company currently boasts a workforce of some 33,000 employees and total assets in excess of $19.31 billion.
Last Updated: 24/12/2009 18:15
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