Crompton Greaves to move out of services business

BANGALORE, August 23: Crompton Greaves (CG), the Rs 1,800 crore division of

Thapar Group, plans to pull out from the services line of business in telecom according to

Crompton Greaves president S.M. Trehan. He added, "We do not want to be in the

services business but plan to confine ourselves to our core competence. So we are

concentrating on manufacturing and the SI business."

As part of that strategy, CG, which had entered the services business in cellular with

equity participation in Sky Cell and in fax storage and forward services under the aegis

of CG Faxemail Ltd., following the liberalization of telecom in the country, will divest

its equity in these two companies. While CG is close to finalizing its equity offloading

in the wholly-owned subsidiary CG Faxemail Ltd, discussions are on to divest their part of

the stake to its partners in Sky Cell, the cellular service provider in Chennai.

Skycell Communication provides cellular services in the city of Chennai and CG has 40.5

per cent stake in the total venture, while the other three equity holders include DSS

Enterprises with 10.5 per cent stake, Bell South and Milicom each with 24.5 per cent share

in the total venture. Skycell is estimated to be the largest cellular service provider in

Chennai. It has an estimated subscriber base of around 23,000 and plans to increase it to

40,000 by the middle of next year. For the last fiscal year, the telecom division of CG

did a business of Rs 94.25 crore and its informatics division recorded Rs 35

crore.

Recently CG has bagged the NIB Phase I order from the DoT.