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Bharti-Singtel logs out of VSNL race

Our Bureau

NEW DELHI, July 23

THE Bharti-Singtel consortium has pulled out of the race for acquiring the Government's 25 per cent stake in Videsh Sanchar Nigam Ltd (VSNL), citing ``strategic reasons.''

The Bharti-Singtel combine categorically stated in a statement here on Monday that it will not bid for the Government's stake in VSNL as Bharti wants to focus its attention on its cellular business.

``We have decided not to bid for VSNL for strategic reasons. We have taken this strategic decision in the wake of the emerging prospect of winning 6-7 mobile licences as a fourth cellular licensee,'' Bharti said in a statement here.

``We feel that at this stage, we would like to concentrate on building simultaneous networks in a short period of time and consolidate our leadership position in the recently-acquired Kolkata circle,'' the company said.

Bharti said it, along with Singtel, would pursue the international voice telecommunications business when it would be opened up to private sector participation next year.

``Respecting the sanctity of the disinvestment process, especially as we could be competing with VSNL in the medium term, we have taken this strategic decision to withdraw before the Data Room visits or any site visit, to maintain the highest ethics of b usiness and competition,'' Bharti said.

The Government had in February last decided to sell off 25 per cent of its 52.97 per cent stake in the international long-distance telephone company to a strategic partner.

Subsequently, SBI Capital Markets and Credit Suisse First Boston were appointed global advisors to the disinvestment process. Unconfirmed reports had said that Reliance Industries, the Tatas, BPL and Videocon were interested in picking up the Government' s stake.

Our Mumbai Bureau adds: Officials at VSNL declined to comment on the decision of Bharti-Singtel to pull out of the race for acquisition of 25 per cent stake in the State-owned company.

``I will not be able to comment on it,'' said Mr S.K. Gupta, Chairman and Managing Director, VSNL, who had come to attend the launch of value-added Internet services from the company here today.

``It is for the buyers to decide, we only professionally run the company,'' he said.

He said the disinvestment process would be completed by the year-end and that the due diligence process was nearing completion.