"The factories need consolidation and control as they operate independently with different human resource (HR) and logistic policies. The segmented operations cannot have power and focus on quality," K R Kim, vice-chairman and CEO (global operations), Videocon, who steered LG to market leadership in his earlier stint, told Business Standard.
The Singapore government-controlled Temasek Holdings, which controls over 90 per cent of power generation and distribution in Singapore, will soon call for bids to privatise the two companies. The Indian companies are exploring various options to bid for these assets, said sources familar with the developments. Spokespersons of both Reliance Power and GMR Infrastructure declined to comment.
Videcocon Industries plans a major consumer electronics retail foray across West Asia, Europe, Africa and Latin America under the brand name "VC" to raise global revenue shares from the current 2 per cent to 50 per cent by 2011.
Indian firms, including Tata Steel, in the past have formed SPVs to acquire foreign companies to protect local operations and also to avoid legal hindrances. The SPV may be registered in a tax-haven country, like Mauritius or Bahamas, the sources said. The move to float an SPV will help Bharti Airtel to continue being listed on Indian stock exchanges, while MTN's promoters will be given a stake in the SPV.
Indian telecom companies are scouting for acquisitions worldwide as part of an ambitious attempt to establish a global footprint. Moreover, the growth momentum needs to be maintained amid the falling average revenue per user (ARPUs) and expected saturation in the domestic subscriber base.
This will pave the way for Kapil Puri to expand Spanco Telesystems, the business process outsourcing and telecommunication services company that he set up after partly exiting Sparsh. Puri is slated to receive around Rs 35 crore (Rs 350 million) from the sale of his stake, which will take place at around Rs 200 per share. This includes a premium as against the existing ruling price of Rs 150 per share.
To up stakes in 'globally active' firms by 3 to 4% this year.
Despite the lack of policy and clear allotment of spectrum, the domestic telecom industry is all set to usher in 3G services with service and equipment providers readying infrastructure.
Reliance Industries Ltd, India's biggest firm by market capitalisation, is drawing up plans to convert its fuel retail outlets, which were recently closed owing to unviable operations, into malls and multiplexes.
While the M1 Group, which holds 9.8 per cent in MTN, today backed Bharti's bid, Singapore Telecommunications said it has no objection to the acquisition.
At a 20 per cent premium, the South African company is valued at $45-47 billion. The Indian GSM provider is looking to acquire a 51 per cent stake in MTN.
Tata Steel, the world's sixth-largest steel maker, is looking to acquire Brazilian iron ore assets of the United Kingdom-based London Mining, which will help ensure raw material supply for its Anglo-Dutch subsidiary, Corus. The valuation of the asset is yet to be completed, but analysts said that it would be in the range of $2 billion.
Engineering giant Larsen and Toubro and Aditya Birla group firm Grasim Industries are set to settle their long-standing dispute over the sale of cross-holdings out of court. Both the companies are believed to be in consultation with Chennai-based chartered accountant S Gurumurthy to act as arbitrator.
Though the controversy over the security of BlackBerry services is yet to be resolved, the four operators that offer these services - Bharti Airtel, Vodafone Essar, BPL Mobile and Reliance Communications - have added over 50,000 customers in the four months since the problems began. Before this, the push-mail service, which was introduced in India in October 2004, had 400,000 subscribers according to industry estimates.
GTL Infrastructure (GIL), a subsidiary of telecom network major GTL, has acquired Essar Group's tower company Essar Telecom Infrastructure (ETIPL) for an estimated $1.5 billion (Rs 6,000 crore), according to sources.
GSM service provider Idea Cellular will invest an additional $400 million (Rs 1,600 crore) for rolling out telecom services in four new circles - Mumbai, Bihar, Tamil Nadu and Orissa - for which it has received spectrum from the Department of Telecommunications.
Datacom Solutions, promoted by consumer electronic goods maker Videocon Industries, is close to roping in South African telecom major MTN group as a partner for its GSM foray in the country. According to sources, Datacom, which was scouting for a partner to bring in investments and technology, has short-listed MTN. Discussions with the South African company are in the final stage and a deal is expected to be signed soon.
The Department of Tele-communications is close to allocating start-up spectrum in seven more circles, in addition to Tamil Nadu, where the process is set to begin next week. According to the telecom ministry's plan, the companies would get 4.4 MHz each and the allocation would be completed within a fortnight.
The Department of Telecommunications is considering a proposal to allocate spectrum, the radio frequencies that enable wireless communications, for third-generation or 3G services to state-owned Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd ahead of other operators. The move is expected to frustrate private players since this will give BSNL and MTNL a head-start in rolling out high-value 3G services that offer video calls, music downloads and games.
With the government issuing 120 more licences to over 10 players that are expected to roll out their networks soon, telecom companies fear a major talent crunch over the next 12 to 18 months. Telecom HRD analysts said attrition rates across levels is expected to go up to 25 per cent from 18 to 20 per cent. Companies expect salaries to jump 15 to 40 per cent, depending on the level, as the great hunt for new recruits takes off.
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