The Tata-controlled Videsh Sanchar Nigam Ltd on Wednesday got clearance from a US government agency for acquisition of undersea cable assets of Tyco Global Network (TGN) for $130 million.
The approval by the Committee on Foreign Investment in the United States will give VSNL control over 60,000 km of undersea communications cable spanning three continents.
"CFIUS, the regulatory body tasked with investigating potential national security concerns, issued a formal notice to VSNL that its review of the situation uncovered no significant issues of national security with regard to this transaction," a VSNL spokesperson said.
VSNL had on November 1, 2004 signed an agreement with Tyco to acquire the undersea cable assets of Tyco Global Network.
Earlier, AP reported that the US Justice Department, FBI, Homeland Security Department and Defence Department signed a 32-page agreement with the company to guarantee the US government can continue to install court-authorized wiretaps on the network and conduct background checks on VSNL employees in the United States.
The agreement also requires that VSNL take steps to prevent illegal eavesdropping on US customers and guarantee that foreign governments can't access classified or sensitive US government information carried over the undersea network.
The agreement acknowledges that the US government would suffer 'irreparable injury' if Videsh Sanchar failed to comply with its promises.
The approval of CFIUS comes shortly after the signing of a security agreement with the US Department of Justice, the Federal Bureau of Investigation, the US Department of Homeland Security and the Department of Defence.
The 5 US bodies filed a joint petition late last night to the Federal Communications Commission (FCC) giving their consent to the acquisition.
Three Republican senators, Jon Kyl of Arizona, Jeff Sessions of Alabama and Ted Stevens of Alaska, asked the panel last week to investigate the sale, calling the undersea cables a 'strategic asset of incalculable value to United States security and commercial interests.'
VSNL spokesperson, however, declined to comment on the subject saying, "We have received approval from CFIUS and the support of 5 US government agencies which shows that we are in compliance with the rules on all the prescribed parameters."
The US panel, which meets in secret, includes representatives from the departments of treasury, defence, justice, commerce, state and homeland security. The committee is run by Treasury Secretary John Snow and makes recommendations directly to the President, who can block sales for national security reasons.
