BSNL to start due diligence on Vavasi, Zain Telecom soon

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By Swagata Gupta. Editing by Namrata Bhatia/NewsWire18

State-owned Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd plan to soon begin due diligence on Kuwait-based telecom company Zain Telecom, said BSNL's Chairman and Managing Director Kuldeep Goyal. "We have received a proposal from Vavasi, and MTNL and BSNL are looking at the proposal. We will do the due diligence soon," Goyal said.

The two Indian state-owned companies have been invited to partner with New Delhi-based Vavasi and Malaysia's Al-Bukhary group to buy a 46% stake in Zain. However, Goyal said the company was cautious on joining hands with Vavasi Group. Goyal was talking at a press conference to launch BSNL's pre-paid broadband services. He said BSNL is looking for acquisition opportunities overseas. "We are looking at various options, we have some proposals from Africa."

Goyal said no specific budget has been earmarked for its international foray. "It depends on what opportunities we are able to finally grab," he said. Also, the company is also looking at entering into new business segments to increase revenue, Goyal said. "BSNL is looking at new business segments like sharing of tower infrastructure and bandwidth."

Goyal sees broadband connections in India to reach 20 million by 2010. "BSNL aims to get 50% of India's total broadband connections by 2010." BSNL has already spent Rs 60 billion from the total capital expenditure of Rs 140 billion planned for 2009-2010(Apr-Mar), Goyal said. On the company's initial public offering plan, Goyal said it was not on the "immediate radar".