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September 3, 2001
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Money > Business Headlines > Report September 3, 2001 |
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17 bids made for tie-up with VSNL NLDBaburajan K As many as 17 telecom players have submitted bids for an alliance with Videsh Sanchar Nigam for its proposed national long distance telephony foray. The bidders include Tata Teleservices, Reliance, Bharti, Powergrid, the Indian Railways, Gas Authority of India, Himachal Futuristic Communications and some leading basic telephone operators, according to senior VSNL executives. As per the plan, the NLD partner will offer its optic fibre cable network on a long-term basis to VSNL for rolling out the domestic long distance telephony service. The alliance could be with more than player, according to the executives. The tie-up could be for a period of about 30 years and the size of the deal worth several thousands of millions of rupees, they said. "The response from all the players has been encouraging, but it is too premature to comment on the nature and financials of the deal," the sources said. VSNL is expected to finalise the NLD partner after choosing the strategic investor as per the divestment programme. This is to avoid confusion as the strategic investor may not accept its rivals as the NLD partner. According to its earlier plan, VSNL will be investing Rs 15 billion in the NLD segment over a period of time. The investment will be in infrastructure in the form of trunk automatic exchanges and interconnecting circles. The company is expected to apply for an NLD operator's licence after finalising the deal. The company by itself does not want to lay optic fibre in an all-India network as it feels it does not make business sense. However, it would lay some and swap capacities with other players laying optic fibre network on different routes. The NLD market is worth Rs 130 billion. But since the intra-circle (Rs 60 billion) has not yet been opened, the effective market size is worth Rs 70-75 billion. The company is looking at achieving a 15-20 per cent share of the NLD business in 3-4 years. Powered by YOU MAY ALSO WANT TO READ:
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