Thursday, March 31, 2005

Crest Urges FCC to Reject VSNL Acquisition Bid for Tyco

Crest Communications issued a public appeal to the Federal Communications Commission to reject Tyco Telecommunication's application to sell its global fiber network to VSNL Telecommunications, which is owned by the Indian government and the Tata Group, India's largest civilian defense contractor.

In its petition, Crest Communications said the proposed sale would "severely compromise the Department of Defense's net-centric warfare plans and threaten the security and integrity of military, intelligence, and other sensitive communications on the cable network."

"This sale of the last remaining global undersea cable network under U.S. ownership and control represents a direct threat to our nation's security," said Brian Roussell, Vice President for Crest Communications.

  • Videsh Sanchar Nigam Limited (VSNL), India's leading international telecom carrier, agreed to acquire Tyco Global Network for US$130 million. The acquisition, which remains subject to government approval in the United States, India and other countries, would give VSNL control over a network that spans 60,000 kilometers (37,280 miles) and three continents. VSNL is part of the $14 billion Tata Group, which recently listed Tata Consultancy Services (TCS) on the Bombay Stock Exchange. The TCS listing was the largest initial public offering by a private sector corporate in Indian history. VSNL said it intends to leverage the IT strengths of the Tata Group in providing services to large enterprises across the world.

  • In September 2004, VSNL America, a local affiliate of India's Tata managed Videsh Sanchar Nigam Limited, was granted an International Common Carrier 214 License from the FCC to own and manage a U.S. network. The company plans to serve U.S. multinational corporations looking to penetrate key emerging markets such as India.

  • In October 2003, Reliance Group, India's largest business house with total revenues of US$16.8 billion, agreed to acquire FLAG Telecom Group for $207 million, representing a premium of more than 50% over the closing price of FLAG's shares on 15-Oct-03. Reliance Infocomm is one India's largest mobile service providers and operates a national, high-capacity network.


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