Reliance Buys Yipes For $300 Million

[petar 15]

July 16 (Bloomberg) -- Reliance Communications Ltd., India's second-largest wireless company, purchased all of U.S.- based Yipes Communications, Inc. for about $300 million, deepening its presence in the enterprise-data services business.

The 100 percent stake was bought from Norwest Venture Partners, JPMorgan Partners LLC, the Sprout Group and Crosslink Capital, Chairman Anil Ambani told reporters today in Mumbai. Yipes, which provides high-speed data network access to 1,000 customers in 14 U.S. cities, operates an optic fiber network of more than 22,000 kilometers (13,670 miles), he said.

``Yipes is highly profitable,'' Ambani said, without disclosing specific numbers. The company, whose gross operating margin stands at 55 percent, ``is cash positive'' and will accelerate Reliance's entry into the $90 billion global market for enterprise and institutional data services,'' he said.

Bandwidth demand is rising in India as software companies such as Infosys Technologies Ltd. and Tata Consultancy Services Ltd. win orders from overseas clients. Indian state-run and private banks are switching to computers and other large companies are automating their supply chains by linking vendors and customers to their own computer networks.

Shares of Reliance Communications rose 11.75 rupees, or 2.1 percent, to 566.45 rupees on the Bombay Stock Exchange at 1:18 p.m. They had risen to a record 572.7 earlier in the day.

[KumaarShah 143]

Wow!!!

[copperco2 24]

any known consequences for us here? except that it is going to be another cash generating machine for the ADAG..

[srk006 21]

I don't see any benefits for the Indian consumers

[petar 15]

Benefits for Indian shareholders though..!