February 05, 2002
Tatas vault ahead in telecom, acquire 25 per cent stake in VSNL
The Tata Group today confirmed that the department of telecommunications, Government of India, has awarded it a 25 per cent stake in Videsh Sanchar Nigam Limited (VSNL). While expressing its happiness in winning the bid, the group also congratulated the deartment of disinvestment, Government of India, for conducting the entire divestment process in a professional and transparent manner.
The Tata Group is already very actively involved in the development of the Indian telecom sector. The group offers basic telephony services in Andhra Pradesh, and has secured licences for Delhi, Gujarat, Karnataka and Tamil Nadu.
Further, it is a major player in wireless telephony through its investment in Birla Tata AT&T Ltd. (BTAL), which is to be merged with BPL. The footprints of BTAL and BPL together cover the states of Delhi, Madhya Pradesh, Chattisgarh, Gujarat, Maharashtra, Goa, Andhra Pradesh, Tamil Nadu and Kerala, as well as the city of Mumbai.
The Tata Power Company Limited, one of the major group companies, is leading the initiative in building telecom infrastructure and offering broadband services. In totality, the group has committed very large investments in the telecom sector.
VSNL is a domestic and NYSE listed company with a FY2001 turnover of Rs 7,966 crore and a workforce of around 3,000 employees. The company has built up a very strong position in international long distance (ILD) services, Internet services and other value-added services, and also possesses a national long distance (NLD) licence.
With the acquisition of the VSNL stake, the Tatas will be able to accelerate their plans to provide NLD, ILD and other value-added services, thus meeting their objective of being a fully integrated telecom services provider.
VSNL enjoys long-standing relationships with international carriers, a solid domestic and international infrastructure, a professional management, and a pool of skilled manpower. The Tata Group plans to leverage these strengths to evolve an effective and aggressive business and product strategy that will enhance shareholder value.
Commenting on the successful bid for VSNL, Mr Ratan Tata, chairman of the Tata Group, said: "We are pleased to have been successful in our bid for VSNL, which will facilitate the enhancement of the spectrum of our telecom services. This meaningful acquisition will enable us to meet our objective faster and help in providing end-to-end quality services to our customers."
In their successful bid for VSNL, the Tatas have been advised by JM Morgan Stanley, Amarchand Mangaldas Suresh A. Shroff & Co. and S. B. Billimoria & Co.
For further information please contact :
Mr Kishore Chaukar
Tel : 022-2867651
Fax : 022-2047996
Mobile : 98210 68262