RCom gains on deal buzz

China's Citic Telecom is reportedly in talks with the Anil Ambani-led company to buy into its undersea cable assets.

Reliance Communications (RCom) has soared more than 3% in early trades on the buzz that China’s Citic Telecom, listed on the Hong Kong Stock Exchange, is in talks with the Anil Ambani-led company to buy into its undersea cable assets. The stock is quoting at the intra-day high of Rs 143, up Rs 4 or 3.2%, on the BSE.

 

The assets are spread over 65,000 kilometres, according to newspaper reports, citing unnamed sources. RCom’s undersea cable business is the business delivery platform for about 40 key markets in India, Europe, West Asia, the US and Asia.

 

According to the report, an equal joint venture, if a deal is successful between the two companies, would value RCom’s cable assets at $1billion (Rs 5,829 crore). The British newspaper said Citic Telecom beat two other bidders from West Asia earlier this month for the venture.

 

RCom has been in talks with a few companies and consortia to sell its undersea cable assets, wholly or partly; but these fell through.