Tata Communications jumps after entering into an agreement to sell Neotel

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surged 5.71% to Rs 475.25 at 09:45on after the company entered into an agreement to sell Neotel to Liquid Telecom.

The announcement was made before market hours today, 28 June 2016.

Meanwhile, the S&P BSE Sensex was up 64.90 points or 0.25% at 26,467.86

On BSE, so far 2.01 lakh shares were traded in the counter as against average daily volume of 37,821 shares in the past one quarter. The stock hit a high of Rs 486 and a low of Rs 473.20 so far during the day. The stock had hit a 52-week high of Rs 490.30 on 24 July 2015. The stock had hit a 52-week low of Rs 325.70 on 29 February 2016.

The large-cap company has equity capital of Rs 285 crore. Face value per share is Rs 10.

Tata Communications announced that Liquid Telecom, a privately owned, pan-African telecoms group, majority owned by Econet Wireless Global, today, 28 June 2016 announced that it has entered into an agreement to acquire South African communications network operator Neotel. The shareholders of Neotel – Tata Communications of India and minority shareholders led by Nexus Connexion – have agreed for Liquid Telecom to acquire Neotel for ZAR6.55 billion. Liquid Telecom is partnering with Royal Bafokeng Holdings (RBH), a South African empowerment investment group, which has committed to take a 30% equity stake in Neotel. The transaction, which is subject to obtaining all affirmative approvals and other corporate approvals that may be required by the shareholders of Neotel and other regulatory approvals, is transformative and will create the largest pan-African broadband network and B2B telecoms provider. Through a single access point, businesses across Africa will be able to access Liquid Africa’s 24,000 kilometres of cross-border, metro and access fibre networks. These currently span 12 countries from South Africa to Kenya, with further expansion planned. The transaction is subject to approval by South African regulatory authorities and is expected to be completed later this financial year, Tata Communications said.

On consolidated basis, Tata Communications reported net loss of Rs 205.89 crore in Q4 March 2016, higher than net loss of Rs 178.25 crore in Q4 March 2015. Net sales rose 6.9% to Rs 5145.41 crore in Q4 March 2016 over Q4 March 2015.

Tata Communications along with its subsidiaries is a leading global provider of communications.