Reliance/GTL deal off
The $11 billion merger of Reliance Infratel, Reliance Anil Dhirubhai Ambani Group's cellular tower arm, and Indian independent telecoms major GTL Infrastructure, has been called off after parties failed to reach an agreement, nixing prospects for investment by the Blackstone Group, the Carlyle Group, TPG Capital and MENA SWF the Abu Dhabi Investment Authority (ADIA).
Discussions apparently came to an end with the expiry of the non-binding term sheet covering the putative deal at end August, and a failure to renew the term sheet after further negotiations. Difficulties possibly included the $1.5 billion cash part of the deal, which GTL, already leveraged, was apparently reluctant to fund, as well as possible opposition from Reliance minority shareholders.
However, further reports indicate that Reliance is continuing discussions with other strategic and financial players, focusing on the spinout of Reliance Infratel, which may still allow an entry for private equity. The original transaction could have led to ADIA, Blackstone, Carlyle or TPG part-funding GTL's cash portion of the deal.
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