GTL mulls buyback of shares

MUMBAI: Network services provider GTL has received board's approval for a buyback of shares worth Rs 275 crore at Rs 300 per share through a tender offer, subject to shareholders' approvals. The company proposes to buy around 9.17 million shares through a tender offer, which represents 9.45 per cent of the company's paid up capital and 8.62 per cent of its fully diluted capital.

"The management strongly believes that its shares are significantly under-valued. The share buyback is proposed to send out a strong signal of confidence of the management in the company's performance and maximise returns to shareholders," GTL CMD Manoj Tirodkar said here.

The company will hold an annual general meeting on June 20, 2007, to take shareholders' approval for the buyback. The company intends to file the tender offer with the market regulator Securities and Exchange Board of India (Sebi).

The buyback will bring in efficiency in cash utilisation and discipline in balance sheet management. The company would also return money to investors in an investor-friendly manner that would not sacrifice on the growth opportunities, Tirodkar said.

GTL would also look at collaborating with the companies in the passive telecom infrastructure business. The company would also look at acquiring stakes in these newly spun-off tower companies. Telecom majors like Idea Cellular, Reliance Communications and Tata Teleservices among others had announced the creation of separate companies to reduce the burden on their service operations.

Tirodkar also said that GTL is open to strategic alliances and private placements.

"We don't rule out any kind of strategic alliances that help in expanding our footprint and consolidating our global business," he said.

(c) CyberMedia News