France Telecom on Monday confirmed it was in exclusive discussions to acquire two units of Indian network services provider GTL Ltd to reinforce its corporate services in India.
“Orange Business Services confirms having started exclusive talks with GTL in order to buy two divisions,” said a spokesman at France Telecom, adding these were information technology and telecom network management businesses.
The Economic Times, quoting a source close to the talks, said at the weekend that France Telecom was close to acquiring GTL's IT business for about 2.5-3.0 billion rupees.
France Telecom declined to confirm the amount.
A source close to the situation told Reuters the figures seemed “coherent”, but that the deal was unlikely to be announced this week as the Economic Times had reported.
Two different sources close to GTL said the Indian group was close to selling off its unit.
One source, who declined to be named, said GTL was talking exclusively to one company, which he declined to name.
If those talks fall through, GTL has the option to talk to other suitors but the exclusive talks are “serious dialogue”, the source said.
A second source, who also did not want to be identified, said: “Right now we are in the process of negotiations. Amongst the different bidders, Orange Business Services… is likely to get the deal.”
The second source said GTL was also holding talks with the UK's BT Group Plc, U.S.-based EMW and other multinational system integrators.
Managed services and enterprise software contribute around 20 percent to GTL's revenue, the remaining 80 percent coming from network services and back-office operations.
The company has been talking of hiving off its software service and back-office operations for over a year now.
The deal is likely to be finalised in two to three weeks but the size of the deal was still under discussion, the sources said.
Source : NDTV Profit