Reliance Communications continues to seek buyer for tower company

India’s Reliance Communications is reported to be trying to sell off its telecom towers business, and has hired UBS to sell its 95 per cent stake in Reliance Infratel.

The bank has already contacted several private equity groups, two US tower networks, and the UAE’s Etisalat about the deal, the India Times reported.

The tower network owner is worth around US$5 billion, and the funds are needed to help reduce Reliance Communications’ significant debt pile, which stood at around US$7.5 billion in May 2011. The interest on the debt is weighing heavily on the telco’s financial performance.

However, potential bidders have said Reliance’s valuation of the stake is at least US$1 billion too high.

Earlier this year, rival Indian tower network operator, Viom Networks (formerly Tata-Quippo) pulled out of talks to buy Reliance Infratel after the two companies could not agree on a price. Again, Reliance was seeking US$5 billion for the company, which Viom described as “unrealistic”.