RCom may sell tower unit's 5% in pre-IPO deal

Reliance Communications (RCom) is learnt to have begun talks with strategic and financial investors for selling 5 per cent stake in its tower unit prior to the planned initial public offering (IPO).

Banking sources with direct knowledge of the development said the company was hoping to raise about Rs 2,500 crore from the proposed sale.

J M Financials is the lead manager of the talks with a host of co-lead managers like J P Morgan, Enam Financials, Duetsche Bank, ICICI Securities and HSBC.

A company spokesperson declined to comment on the issue citing Securities and Exchange Board of India (Sebi) guidelines.

Sebi rules bar a company from disclosing information about itself after getting approval for an IPO.

In 2007, the company had sold five per cent in Infratel for Rs 1,400 crore to seven financial investors that included George Soros, HSBC, Fortress Capital, New Silk, Galleon, DA Capital and GLG Capital — in a deal valuing the firm at Rs 28,000 crore.

If the pre-IPO placement talks materialise into stake sale and the planned 10 per cent IPO takes place, then RCom's stake will reduce to 80 per cent.

Earlier, Reliance Infratel had filed with the Securities and Exchange Board of India for the IPO, which sources had said could raise up to Rs 5000 crore for a 10 per cent stake which valued the company at Rs 50,000 crore.