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The much-awaited possible merger between Sun Group and Reliance ADA for the DTH business may be off the table, reports CNBC-TV18 quoting sources.
Sources had earlier indicated that the two players were in talks for a deal and had formalised some areas but eventually the whole proposal collapsed. "The talks were at a preliminary stage and if the deal went through it would be a good strategic fit and would help both the companies to capture a larger market share,” said a source familiar with the development.
“However due to differences over valuation and some other distribution contours, the talks did not go ahead.”
Sources also say that the talks between the two players had been called off about a month ago and while RCom still wants to bring in a strategic player for its DTH business, it has not found interested buyers yet.
For RCom, a staggering debt of Rs 30464 crore is a clear concern and it has been looking at various avenues to bring down this debt. One of the modes to bring down this debt includes a stake sale in its Globalcom business. The company had said in April 2013 that it was in talks with a consortium of PE players led by Samena Capital to sell stake.
There were talks of Bahrain based telecom player Batelco showing interest in Reliance Globalcom. However, the company had said in a statement to exchanges in April 2013 that, “Reliance Communications and Samena Capital are no longer in discussions with Batelco for the purposes of the above transaction”.
The statement further added that May 2013 was the timeline for the deal to go through. However, the deal hasn’t taken off yet. Impatient investors had quizzed the company during its nineth Annual General Meeting (AGM) in August 2013 to which Anil Ambani had responded, “To create more value for shareholders, various discussions are in progress and as and when we have something to report, we will notify the exchanges”
Sources had earlier indicated that the two players were in talks for a deal and had formalised some areas but eventually the whole proposal collapsed. "The talks were at a preliminary stage and if the deal went through it would be a good strategic fit and would help both the companies to capture a larger market share,” said a source familiar with the development.
“However due to differences over valuation and some other distribution contours, the talks did not go ahead.”
Sources also say that the talks between the two players had been called off about a month ago and while RCom still wants to bring in a strategic player for its DTH business, it has not found interested buyers yet.
For RCom, a staggering debt of Rs 30464 crore is a clear concern and it has been looking at various avenues to bring down this debt. One of the modes to bring down this debt includes a stake sale in its Globalcom business. The company had said in April 2013 that it was in talks with a consortium of PE players led by Samena Capital to sell stake.
There were talks of Bahrain based telecom player Batelco showing interest in Reliance Globalcom. However, the company had said in a statement to exchanges in April 2013 that, “Reliance Communications and Samena Capital are no longer in discussions with Batelco for the purposes of the above transaction”.
The statement further added that May 2013 was the timeline for the deal to go through. However, the deal hasn’t taken off yet. Impatient investors had quizzed the company during its nineth Annual General Meeting (AGM) in August 2013 to which Anil Ambani had responded, “To create more value for shareholders, various discussions are in progress and as and when we have something to report, we will notify the exchanges”
