Saturday, December 5, 2009

BSNL Puts Zain Purchase On hold

Bharat Sanchar Nigam Ltd (BSNL) has put its plan to be a part of the consortium looking to buy a stake in Kuwait's Mobile Telecommunications Co, on hold. The decision was taken as the information sorted by Vavasi Group has still not been received.

Vavasi Group which is not yet listed in India had tied up with Al-Bukhary group of Malaysia to buy a 46% stake in Zain.  It was trying to add state-owned Indian telecommunications firm like BSNL and Mahanagar Telephone Nigam Ltd., to the consortium. By joining the consortium, BSNL and MTNL seek to widen its horizon beyond India.

Earlier, Gurudas Kamat, India's junior telecom minister had said that both MTNL and BSNL are not very serious about joining the consortium.

The state owned telecom companies are facing stiff competition from private sector companies. According to BSNL Chairman Kuldeep Goyal, BSNL's revenue is going to be severely hit by the latest tariff war in the current financial year.

The company is planning to add 20 million working lines to its present 50 million on the global system for mobile communication platform, over the next six months. Besides, it is also planning to spend INR140 billion in the current fiscal year to expand its mobile services.

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