INDIA BUSINESS WORLD - JUNE - JULY - 2007
The Month that was ...

FRANCE TELECOM BAGS MUMBAI-BASED GTL DIVISION IN AN ALL-CASH DEAL

FRANCE Telecom has acquired the enterprise and managed services division of Mumbai-based GTL, a provider of network services, in an all-cash deal. While the size of the transaction was not disclosed, sources said it could be around Rs170 crore. The move is part of GTL's ongoing restructuring programme aimed at focusing on the networks business.

The acquisition was made through the business communications arm of France Telecom Group, called Orange Business Services. It will help Orange to serve Indian and multinational companies throughout the region in customer relationship management (CRM) solutions, CRM application integration and on-site and remote management of networks and hardware.

The acquired division counts 591 employees, including 200 certified engineers, and a customer base of 450 Indian and multinational clients including Citibank, Standard Chartered, Deloitte, WNS and First Source. Post its acquisition of the GTL divisions, Orange Business Services' workforce will grow to over 1,590 in India.

The enterprise and managed services division had revenues of around Rs 140 crore in 2006-2007, growing 34% year-on-year. Postsale, GTL's revenues are projected to be around Rs 1450 crore-Rs 1600 crore for FY08 with an EBDITA of Rs 190 crore-Rs 220 crore, GTL CMD Manoj Tirodkar said at a conference announcing the deal in Mumbai on Wednesday. "The hiving of the enterprise business is part of our efforts to focus on network services for Telecom carriers," he added.

Orange Business Services CEO Barbara Dalibard said there were no plans for other acquisitions in the near future. "I don't see any more need to invest in inorganic growth," she said. The acquisition of GTL's business would strengthen the presence of Orange Business Services to serve its multinational customers in India as well as serve Indian multinationals that are exploring overseas markets, better, she added.