Hong Kong?s Citic Telecom is in talks with Reliance Communications (RCOM) to acquire its submarine cable assets. The deal, which is expected to conclude within a month, values RCOM?s cable assets held by the company?s Global Cloud Exchange unit (earlier known as Reliance Globalcom) at $1 billion.
Standard Chartered is advising Citic Telecom on the transaction whereas Hong Kong-based investment bank IRG is the advisor for RCOM.
For over a year, RCOM has been making attempts to reduce liability by selling stake in its undersea cable business. As of March 31, 2014, RCOM?s debt stood at about $6.8 billion. In 2013, RCOM was in talks with Bahrain Telecommunications Company (Batelco) to sell stake in Reliance Globalcom. Batelco was looking to acquire a majority stake in the company and had valued Reliance Globalcom at $1.3 billion.
However, the deal could not materialise and RCOM had to start afresh the process of looking for another buyer.
