For quite a few years now, the Indian telecommunications giant Reliance Communications has been looking for a way to monetize its international networking assets. According to Telegeography, China’s CITIC Telecom is said to be preparing a bid, at least for the submarine cable part. Have they finally found a buyer?
Reliance’s submarine cable assets are part of what we now call Global Cloud Xchange, which rebranded from Reliance Globalcom and was assembled from the former Flag submarine cable business, the Ethernet provider Yipes, and the UK-based Vanco among other bits and pieces. Earlier this year they brought in Bill Barney to take over as CEO, and have announced plans to make new submarine cable investments in the Indian Ocean and the Pacific.
However, Reliance has been trying to sell it all for about five years now. After being unable to find a buyer willing to meet its price, they tried an IPO in Singapore. But that fell through due to market conditions. In the spring of 2013 it looked like they had a buyer over in the Middle East as Bahrain’s Batelco taking a serious look, but an actual deal never materialized. Now it may be CITIC’s turn.
Supposedly, CITIC would only be looking at the submarine cable business, with a price tag in the neighborhood of a billion or so. Reliance would have to find a separate buyer for the rest, presumably. CITIC Telecom and its conglomerate parents are a bit of a puzzle to me, but I think China in general has long been interested in getting a piece of the global submarine cable business under its control for a while. They’ve had to be careful about it though for political reasons. I wonder if this foray by CITIC will run into a few of those, as China and India are longstanding regional rivals.
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