INDIA BUSINESS WORLD OCTOBER (1^st - 20^th) 2007
The Month that was ...

FIIS TAKE 49% OF GHC FOR RS 560CR

A clutch of foreign investors, including Singapore's SC Bank private equity fund, Mauritius's Technology Infrastructure, Park Holding Finance Corporation from Virgin Islands and others, have picked up a 49% stake in Global Assets Holding Corporation (GHC), the holding company of leading network services company GTL Ltd and telecom tower player GTL Infrastructure Ltd, for Rs 560 crore.

GHC is also the holding company of two unlisted firms - India Wireless Technology Ltd, in which it holds a 30% stake, and Global Innov-Source Solutions, which it wholly owns.

Following this deal, GHC will increase its investment in GTL from 28% to 62%. It will also increase its stake in GTL infrastructure. Also, with GHC offloading stake in these investors, the total foreign direct investment in GTL will increase to a little over 71% from 40.7% while in FDI in GTL Infrastructure will rise to 39.3% from 33.9%.

GHC has established itself as a leading player in the telecom infrastructure and networking services space. At present, the group has combined revenues of Rs 1,281 crore and over 5,000 employees across 25 countries. GHC has also informed the Foreign Investment Promotion Board (FIPB) that it would use the proceeds to further increase its investments in other unlisted group companies. It has also added that it will invest in its overseas subsidiaries for expanding business opportunities globally.

Industry sources said that investors had picked up stake in GHC primarily because of the impressive performance of GTL and GTL Infrastructure. GTL is amongst largest network services providers in India and offers a range of services such as network planning and design, network deployment, operations and maintenance and also infrastructure management. It has a presence in 20 countries and is associated with about 35 operators globally.

On the other hand, GTL infrastructure is India's third largest passive telecom infrastructure provider. The company is currently embarking on a ambitious plan of rolling out more than 22,000 towers across various telecom circles in India. The unlisted India Wireless Technology is in the business of manufacturing and fabrication of steel towers for telecom networks and the power transmission industry.

GTL is also arranging funding to the tune of Rs 1,000 crore for making global acquisitions and has already kicked off talks with at least four different companies toward this. Recently, GTL had acquired Genesis Consultancy, a UK-based network services provider, for about over Rs 40 crore. Additionally, GTL Infrastructure has already rolled out 1,200 cell-sites and plans to set up another 6,700 towers by March 2008 with an investment of Rs 2,030 crore.

The potential for stand-alone tower business sector in India can be gauged from the fact that the country will need about 350,000 towers by 2010 from about 111,000 at present, as per the estimates of the Telecom Regulatory Authority of India.