RCom acquires WiMax operator eWave World, to expand global footprint

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Reliance Globalcom, the global arm of Reliance Communications, has bought 90 percent stake in the British Virgin Islands-registered company that specializes in fourth-generation (4G) services, sources close to the deal said.

Last month, International Business Times had reported that Reliance Communications is set to acquire a Europe-based specialty WiMax operator and plans to become a major player in the international telecommunication market (http://in.ibtimes.com/articles/20080324/reliance-communications-wimax-broadband.htm).

Reliance Communications would soon launch 4G services globally and to that extent, will be investing $500 million through eWave over the next 2-3 years for acquiring and building WiMax networks across 50 countries, the source said.

In a bid to expand its global footprint, Reliance Communications had acquired US-based ethernet services provider Yipes Holdings for $300 million in July 2007. The Mumbai-based company also bought Anupam Global Soft in Uganda in February this year, to help it start offering wireless and fixed-line phone and Internet services in the African nation. It entered the WiMax space when it acquired a strategic stake in French WiMax chip manufacturer Sequans Communications during the same period.

"This acquisition will enable Reliance Globalcom to create the largest WiMax and broadband company in the world, banking on eWave World's presence across Latin America, Central America and China among others. This is a significant step forward in Reliance Communications' global growth strategy to directly reach out to millions of customers both corporate and individual through a best-in-class last-mile network," said Punit Garg, CEO, Reliance Globalcom.

"The 4G WiMAX network in 50 countries would enable us to offer services to over 75 percent of global population in combination with Reliance Globalcom's 115,000 km IP (internet protocol) enabled network spread across six continents," he said.

''We will acquire the advantages of economies of scale and access to emerging markets and provide an end-to-end quality communication,'' he added.

The acquisition would be funded through internal accruals.

"Today many emerging markets are effectively excluded from the full benefits of internet because of lack of broadband service. With the backing of Reliance, eWave World will deliver broad band services to business and residential customers in numerous emerging markets. We consider this represents a very significant opportunity for both eWave World and the countries in which we plan to invest," said Jay Metcalfe, chairman, eWave World.

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