Network services provider GTL has sold its enterprise network services and managed services business to Orange Business Service, an arm of France Telecom, for about Rs 150 crore (Rs 1.5 billion) in cash.
"The hiving of the enterprise business is part of our efforts to focus on network services for telecom carriers," GTL Chairman and Managing Director Manoj Tirodkar told reporters in Mumbai.
The revenues of the IT services business being hived off was Rs 140 crore (Rs 1.4 billion) last year and growing at about 30 per cent per year, he said. GTL had sales turnover of Rs 1,150 crore (Rs 11.5 billion) last year.
Tirodkar said he would not reveal the exact amount for which the business has been sold to Orange due to regulatory restrictions. But it is 1.1 times the revenues, he indicated.
GTL is not selling any fixed assets under this deal. But it would be making significant savings by hiving of the IT business as there were 590 employees working in this division with wage and overheads bill of Rs 42 crore (Rs 420 million), Tirodkar said.
GTL COO Charudatta Naik said this divestment would not impact the revenue growth of the company and it would stand by its 30 per cent growth rate for the year.
The company also plans a major overseas acquisition.
Tirodkar did not disclose any details but indicated the acquisition would be sizeable and as big as GTL itself. The company had posted sales turnover of Rs 1,150 crore last year.