Rich From Mci Pickings, Bt Comes Calling On Indian Telecom Cos

With some $7 billion (Rs 28,000 crore) in its kitty from the sale of its 20 per cent equity in MCI Communications Corp from WorldCom, British Telecom is aggressively looking for stakes in telecom companies in India and the Asia-Pacific region. The depreciating currencies in the region make investments in telecom companies attractive, sources said.

BT executives here said they were discussing with promoters of several cellular companies possible acquisitions of equity stakes. Arun Seth, BT managing director for the India-Bangladesh region, said: Yes, we have been receiving offers (for equity stakes in companies). Besides the Mumbai market, which we have been interested in for some time, there are others too which we have been looking at. He refused to name the companies BT was negotiating with.

 

The British telecom carrier has a presence in India with a 22.5 per cent stake in Bharti Cellular, the Delhi cellular provider. It also holds 49 per cent stake in a satellite-based V-SAT (very small aperture terminal) service joint venture with the Bharti group.

A $7 billion agreement was concluded between BT and from WorldCom for the formers 137 million shares in MCI. Additionally, the $22.5 billion British major received $465 million as break-up fee, including expenses, according to the terms of the merger agreement between MCI and BT.

Following BTs decision to sell its 20 per cent stake in MCI to WorldCom, Alfred Mockett, managing director of BT Global Communications said: Asia Pacific is the world fastest growing telecommunications market and therefore is a primary focus for BT. BTs Asian strategy is robust, aggressive and completely deliverable outside of the MCI deal.

We will continue to pursue partners for joint ventures and alliances to build on the 20 we already have in the region. We have embarked on major joint ventures in Japan, Singapore and India and we are committed to this strategy.

BTs interest in the domestic cellular market the company has publicly announced that it is interesting only in wireless telecom markets makes it perhaps the only company to considering acquiring stakes in the country. Most US telecom operators have already committed funds to entering into alliances in their home markets.

Similarly, European telecom carriers also plan to make huge investments while entering the just-liberalised continental markets. European Commission economies opened up their home markets to competition on January 1 this year.

South Asian telecom operators, on the other hand, are cash-strapped following currency turmoil in their countries.