Reliance denies plans to sell FLAG
Reliance Communications has denied reports that it is planning to sell off its FLAG cable system.
The Indian telco was hoping to raise as much as $3 billion (€2.05b) from the sale of the global subsea cable system, Reuters reported Monday.
The company had appointed Deutsche Bank to advise on the sale, the report said. Bids are due in by late January.
However, a spokesperson told the Wall Street Journal today: “We vehemently deny these speculations.”
Analysts said Reliance needs to raise funds to expand in the increasingly-heated domestic market, where a price war is underway and the government will admit more operators when it issues 3G licenses next year.
Reliance, India’s second-biggest carrier, bought FLAG - the world’s first global fiber submarine network – for $207 million in 2003.
Reliance reported a two-thirds sequential fall in profit in the September quarter, with sales down 7.6%.