Viom Networks interested in RCom's tower biz

SREI Infrastructure Finance-backed Viom Networks is reported to have shown interest in acquiring Reliance Communications' tower business, which is up for sale. Sources close to the development say both the companies have held meetings over a possible deal.

"We are interested in any tower assets which are on sale. But it is tough to talk on particular assets. We have not received a formal bid invitation from the company," said SREI Infrastructure Finance Chairman Hemant Kanoria. Reliance Communications did not respond to the development.

The Tatas too, form a part of Viom Networks' promoter group, after Tata Teleservices merged its tower portfolio with Viom, which was earlier known as Quippo. Tata Sons and Tata Teleservices together own 54 per cent stake in Viom. Apart from SREI Infrastructure, private equity player SBI Macquarie had also invested into the tower company in August 2010.

Viom Networks has 38,000 towers and has plans to add 20,000-25,000 towers, with an investment of around Rs 8,000 crore, in the next two years.

The sale of Reliance Infratel, the tower subsidiary of Reliance Communications, had created a buzz in the market after the company, in an announcement to the stock exchange last month, said it had received offers for the sale of the business. RCom has, for about a year, been trying to sell its tower business, and retire some of its debt, which stands at aroundRs 32,048 crore.

"The board of directors was informed of the receipt of the formal indicative offers from several interested parties for the acquisition of RCom's controlling interest in Reliance Infratel Limited, its passive infrastructure subsidiary. The board had, accordingly, approved taking the process to the next stage of detailed due diligence, with a view to completing such a potential transaction at the earliest," the company said in a statement. Media reports had earlier said private equity players like Blackstone, Carlyle, TPG Capital, and Apax Partners showed interest in these assets. However, neither Reliance Communications nor private equity firms commented on the development.

Last year, RCom had signed an agreement with GTL Infra to merge the tower assets of both the companies. However, the deal did not materialise. Reliance Communications' stock declined by 1.2 per cent today to close atRs 93 per share, according to per data available with the Bombay Stock Exchange.