VSNL's acquisition of Tyco has elevated India's leading provider of international telecommunications and internet services to the ranks of the world's largest providers of submarine cable bandwidth

The wooing process was long and the negotiations were hard as nails, but the prize made the endeavour more than worth it for VSNL. India's leading provider of international telecommunications and internet services had to ward off rival suitors and satisfy a raft of regulatory authorities in the US and other countries to secure its $130-million acquisition of Tyco Global Network (TGN), the state-of-the-art undersea cable network that spans 60,000 km and the continents of North America, Europe and Asia.

The acquisition, the culmination of an eight-month effort, immediately elevated VSNL to the ranks of the world's largest providers of submarine cable bandwidth, but the deal delivers more than just an increase in size. "This acquisition is another positive step in our ongoing drive to offer global connectivity and efficient communications solutions to our customers," said N. Srinath, VSNL's head of operations. "[It] confirms our position as a leading global service provider. It also positions the Tata Group as an entity that can provide seamless telecommunications and IT services under a single umbrella for global enterprises."

Kishor Chaukar, managing director of Tata Industries, one of the promoter companies of the Group, was just as upbeat about the deal and what it means for VSNL. "The price that VSNL has paid is a fraction of Tyco's total cable assets," he said. "This is a unique global network, with assets of almost $2.5 billion. VSNL was short on bandwidth, information and technology. With this deal no one will be able to beat us."

TGN will provide much-needed momentum to VSNL's objective of expanding into key global markets. "Our multinational clients require seamless connectivity around the globe and customised network architecture," says Vinod Kumar, president, VSNL International, the division spearheading the company's global thrust. "The combination of TGN assets and the deep network penetration of VSNL throughout India will allow us to design customised and scalable connectivity solutions between all the key global business centres through a single point of contact."

Sealing the Tyco deal was anything but a piece of cake. Approval for the acquisition came from the Federal Communications Commission (FCC) in the US after a process that included formal reviews by the Committee on Foreign Investment in the US, the Department of Homeland Security, the Department of Defence, the Department of Justice, the Federal Bureau of Investigation and other agencies.

That VSNL will benefit immensely from the acquisition is not in doubt. The telecom and data explosion happening in the Asia-Pacific region at present means that TGN has the potential to provide connectivity for the region to the US. More than that, with TGN in its basket, VSNL becomes an end-to-end telecommunications solutions provider.

The coming together of the two giants bodes well for the future of telecommunications and most importantly the consumer.