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Indian operator to hold exclusive discussions with rival’s shareholders for a further 60 days, having made ‘good progress’ to date.
Reliance Communications on Wednesday announced that it has extended the exclusivity period for its talks with rival Aircel’s owners, insisting it is making progress towards the brokering of a deal that would see the pair merge their mobile operations in India.
RCom entered into merger negotiations with Aircel shareholders Maxis Communications and Sindya Securities and Investments late last year. The parties agreed to a 90-day exclusivity period.
They have now agreed to extend talks by a further 60 days to 22 May "to consider the potential combination of the Indian wireless business of RCom and Aircel and mutually derive the expected substantial benefits of in-country consolidation, including opex and capex synergies and revenue enhancement," RCom said, in a statement.
The telco said the new deadline reflects "the good progress made so far" between the companies.
There have been numerous press reports over the past 90 days regarding the type of deal that could emerge from the talks.
A month ago the Economic Times claimed that the companies had agreed a 50:50 joint venture, with both contributing the same amount of debt to the new entity, contradicting earlier reports that said Aircel needed to sell spectrum to Bharti Airtel in order to raise money to pay down debt prior to any deal with RCom.
An unnamed source cited by the paper said the telcos hoped to close the deal by the end of September, adding that they would rebrand the new entity. The source added that the new venture could be listed in future.
There has been no formal comment from either party on the structure or timing of any deal though.
Indeed, on Wednesday RCom again noted that the discussions are non-binding and there is no certainty a transaction will emerge.
