GTL, Singapore's Redington call off merger plan

Indian telecom equipment maker GTL Ltd and the Singapore-based Redington Group said on Thursday that they would not proceed with their proposed merger.

GTL had said in February that it would acquire Redington for $95 million in cash and stock.

The two companies had decided to call off the merger because Redington's shareholders could not unconditionally guarantee a vendor relationship with GTL over three to five years, a notice on the Bombay Stock Exchange Web site, www.bseindia.com, said.

Redington's shareholders had also given substantial guarantees to their bankers and vendors, which, if reflected in GTL's balance sheet as a result of a merger, would be unviable for the Indian company and its shareholders, the notice said.

GTL's shares were down 1.6 per cent at 66.10 rupees at the Bombay Stock Exchange, whose main index was up 0.42 per cent.