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Tuesday, February 2, 2010

Few call for Reliance Comm global asset sale

More than a month after putting its biggest global assets up for sale, India's Reliance Communications has found few callers for a package that includes its prized FLAG undersea cable network.

Sources close to the deal said Reliance Comm had already extended an initial deadline of late-January for submissions once, but had still attracted little interest for the deal seeking $3 billion.

The sources spoke on condition of anonymity because of the sensitivity of the situation.

One source said Singapore Technologies Telemedia - which owns stakes in Singapore's StarHub and undersea cable operator Global Crossing -- is contemplating a bid.

A spokeswoman for Singapore Technologies Telemedia, a fully-owned unit of state investor Temasek, declined comment.

The source added that another company said to have expressed interest was NTT Corp, though an NTT spokesman said the company was not considering a bid.

Sources said complaints surrounding the deal, being shopped by Deutsche Bank, include a dearth of financial information, concerns about debt and over-abundance of the kinds of assets and services being offered.

"It is no longer something which is in short supply," said Arun Kejriwal of Mumbai-based investment advisory firm KRIS. "Earlier you thought you cannot do without a cable system of your own. But now it's not the case. You can hire whatever you want."

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