Reliance ups Flag bid

9 Dec 2003

Reliance Gateway Net, a subsidiary of Reliance Infocomm, has raised its bid price for Flag Telecom from USD207 million to USD211 million in cash. Reliance was forced to improve its offer after a rival suitor, Pivotal Private Equity, bettered its bid. The latest move means that the original MoU signed by Reliance and Flag in October, will be amended. In a separate announcement, Reliance also revealed that it has entered into a voting agreement with Flag’s largest shareholder Harbert Distressed Investment Master Fund, which owns 37.1% of Flag, to vote in favour of the Reliance purchase; Reliance will pay USD1 million in cash to Harbert upon consummation of the amalgamation.