May 2012
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Blackstone, Carlyle call off Reliance Communications deal

According to reports, private equity firms Blackstone and Carlyle have pulled out of their proposed deal with Reliance Communications. If finalized, they would have owned a majority stake in the telecom service provider’s telecom tower unit.
Mr Anil Ambani’s Reliance Communications has long been looking for prospective buyers. Blackstone and Carlyle were reportedly on the final stages of buying a 95% stake in Reliance Infratel tower unit. The company is severely cash-strapped, and saddled with a debt equaling almost $7 billion.
Had the deal materialized, the company would have been relieved of at least Rs 35,000 crore of its debt. But RCom had expected a valuation of Rs20,000 crore, which the private equity investors found too high. After negotiations, the deal was called off.
The company refused to comment on the development. However, it is expected that a fresh round of discussion will follow with the investors. Reliance Communications has 50,000 towers across the country. Blackstone and Carlyle too, have refused to comment on the issue.
A Reliance Communications representative said in a TV interview that the company is in talks with investors for sale of the tower unit. He also said that the company expects a stake sell by the end of the second quarter of 2013.
RCom is reportedly seeking for clarity on the spectrum auction guidelines. Three deals are reportedly stuck in the process.
Source: Business Review India

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