Mumbai, June 13: The Singapore stock exchange has approved Reliance Communications' plans to float an initial public offering (IPO) for its undersea cable unit that could raise over $1 billion.
Reports said Reliance Communications (R-Com) could float the IPO in four to five weeks but this could not be confirmed.
The float will help Anil Ambani's R-Com to pare its debt of roughly $7 billion that the firm has been looking to trim.
In a communication to the stock exchanges, R-Com said, "On April 10, 2012, the company announced that it was evaluating a potential IPO after listing in Singapore of its subsea telecommunications infrastructure network business through a Singapore business trust. On June 12, 2012, the Singapore Exchange Securities Trading Limited granted an 'eligibility to list' to the business trust subject to the requisite conditions being satisfied."
R-Com shares ended the day 2.62 per cent higher at Rs 68.60 on the Bombay Stock Exchange.
A Mumbai-based analyst said R-Com would concentrate on launching the IPO for the undersea cable unit shortly despite volatile market conditions as it had not yet met with much success in selling off its telecom towers and trimming the massive debt on its books.
Unconfirmed reports said R-Com was looking at selling 75 per cent of the wholly owned undersea cable unit through this IPO. Deutsche Bank, Standard Chartered and Industrial and Commercial Bank of China are advisers to this IPO.
On Wednesday, another Anil Ambani group company, Reliance Capital, said it had received approvals from market regulator Sebi and the Monetary Authority of Singapore for a 26 per cent stake sale amounting to Rs 1,450 crore in its mutual funds business unit to Nippon Life of Japan. The Singapore approvals were mandatory since Reliance Capital has operations in that country.