RCOM disputes ‘excessive’ valuation for Infratel

Indian cellco Reliance Communications (RCOM) has become embroiled in a dispute with private equity investors over the valuation of Reliance Infratel, after the group decided to merge the tower management firm with another RCOM subsidiary, Reliance Communications Infrastructure. The Economic Times writes that the private equity investors – which include Quantum, NSR Partners, Galleon, HSBC Daisy Investment (Mauritius) and Drawbridge Towers – opposed the merger and are looking to sell their roughly 4% stake in Infratel back to RCOM, having had the tower company independently valued at INR321.3 billion (USD5.15 billion) in 2014. RCOM has agreed to purchase the stake, but at a fair price, calling the quoted valuation ‘excessive’. As a show faith, the operator has offered to sell its entire stake in Infratel to the investors at a 10% discount to the quoted valuation.