July 17: In fashion with the current trend of Indian companies going global Reliance Communications treaded the same path and had a big deal of $ 300 million with Yipes data communication service provider that is Ethernet services.
This is R Com’s largest acquisition till yet and it promises R Com’s entry into $100 billion global enterprise data market.
“The deal forwards the strategy of the company to provide the most sophisticated, cutting edge data communication products and services, specializing in application and content distribution”. Said R Com chairman Anil D. Ambani
According to the chairman, they have plans to globalize Yipes services by their customer relationships and network and see the increased growth of their own global data business buy this acquisition
The deal will definitely give R Com the access to global customers and will help increase the growth of their own global data business. The event made R Com the third largest global Ethernet service provider of the world.
The news of the big deal pushed the stock price of R Com up on Bombay stock exchange after the stock rose to record 577.40 rupees.
Experts see as a big strategic deal which will give Flag telecom a platform in US enterprise market and become a global player in telecommunications.
R Com plans to expand its coverage in US and spread Yipes services to 40 new markets globally including Middle East, Asia and India through Flag global network. Yipes, a 100% subsidiary of flag telecom currently covers 14 US metro cities which accounts 40% of the Ethernet market of US and is also has its units in Hong Kong, London, and Tokyo.
Yipes chairman and managing partner Norwest Venture foresee a grand transformation on cards in global telecommunications by this acquisition.
R Com president, global business Punit Garg said that the whole business of data communications in the world accounts for $ 10 billion and promises to grow at a rate of 30%. This will highly increase the revenue.
Telling about the good business prospects for Yipes in India, Mr. Garg expressed hope that BPOs and ITes will create a great market share for them.
Reliance maintained the trend started by TATA Tea when it acquired the UK’s famous brand four years ago. Total value of overseas acquisition by Indian companies in 2006 has been $6 billion and is increasing year by year. Reliance is just another addition.
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