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Reliance Communications, China Mobile In Tie-up Talks

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http://www.business-standard.com/india/new...p-talks/361752/

Anil Ambani-controlled Reliance Communications (RCom) has started preliminary talks with China Mobile, the world’s largest mobile company, for a strategic alliance and possible equity participation of 5 to 6 per cent.

In February, Wang Jianzhou, China Mobile’s chairman and CEO, told Business Standard at the Mobile World Congress in Barcelona that the company was keen to expand to India. China Mobile has over 450 million subscribers.

RCom, which offers CDMA mobile telecom services and started GSM services a few months ago, has over 70 million customers.

An RCom spokesperson declined to comment and an email query to China Mobile was unanswered.

The Chinese telecom company, which is listed on the New York Stock Exchange, has operations in Pakistan, where it acquired Paktel for $460 million in 2007 and renamed the company CMPak.

It also operates mobile services in Hong Kong and recently bought a stake in Far East Tone Communications which operates mobile services in Taiwan.

RCom is expected to require cash to bid for licences for third-generation (3G) services, auctions for which are expected later this year. The reserve price for the auction has been set at a steep Rs 4,040 crore.

The company recently announced that it would like to issue equity shares to qualified institutional buyers to finance its 3G bid, expand its broadband business and bolster its financials. With a net worth of over Rs 63,000 crore, the company has cash flows of over Rs 12,000 crore.

Chinese companies, however, have been subject to security controversies, especially those with Pakistani operations.

The government, however, recently cleared a deal between Swedish company Telenor and realtor Unitech’s telecom venture, though the former has operations in Pakistan.

The government also cleared another Chinese company, Huawei Technologies, which won a contract to supply GSM equipment to state-owned Bharat Sanchar Nigam Ltd in south India.

Many Indian telecom companies have been looking stakes and strategic alliances with international companies. For instance, Bharti Airtel, India’s largest private telecom service provider, recently signed an agreement to explore a global alliance with South Africa’s MTN ahead of an eventual merger.

Tata Teleservices recently sold 26 per cent to Japan’s NTT DoCoMo which is playing a key role in its launch of GSM services.

Last year, new entrant Swan Telecom sold 45 per cent to UAE-based Etisalat for close to $900 million and Unitech Wireless, with 22 circles, sold 60 per cent to Telenor for Rs 6,120 crore.

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So, will RCOM sell off RCDMA in order to finance its foray into 3G-GSM?

The Chinese telecom company, which is listed on the New York Stock Exchange, has operations in Pakistan, where it acquired Paktel for $460 million in 2007 and renamed the company CMPak.

It also operates mobile services in Hong Kong and recently bought a stake in Far East Tone Communications which operates mobile services in Taiwan.

RCom is expected to require cash to bid for licences for third-generation (3G) services, auctions for which are expected later this year. The reserve price for the auction has been set at a steep Rs 4,040 crore.

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with rgsm alone they cant survive.. so selling cdma completely is a bad decision.. lets see what happens..

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Its not about selling whole business ramesh.... its just a preparation for extra funds for 3G auctions.....

GSM and CDMA both comes under Rcom so its out of questions they can even sell CDMA business alone to anyone.....

They face lack of funds for 3G auctions where airtel got huge funds ready for it...

Lets see..

Let the game begin...... :D

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China Mobile denies any deal with India's Reliance Communications

Jun. 23, 2009

China Knowledge

China Mobile Ltd, the country's largest telecom operator, currently has no plans to invest in the Indian telecom market, said a spokeswoman for China Mobile, the Wall Street Journal reported on Monday.

The Business Standard on Monday reported that China Mobile and Reliance Communications had held preliminary talks for an alliance, with a possible 5% to 6% equity participation.

Spokeswoman Rainie Lei denied the report, saying there were no talks between the Chinese carrier and India's Reliance Communications Ltd on forming a strategic partnership.

Reliance Communicaitons is the second-largest mobile operator in India. The company is in need of cash to bid in the 3G wireless spectrum auction at the end of this year, said the paper.

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would it be similar to verizon and att and alltel?

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