Tata Communications to invest $300 mn on expansion in FY18

The company is likely to spend $150 mn on network and $150 mn on its platform and software.

The Dollar Business Bureau

Global telecom company Tata Communications Ltd is going to invest about $300 million to expand its network, its software and  improve its platform during the next financial year 2017-18. The company is also eyeing to acquire new service fields like cloud, mobility and Internet of Things (IoT).

"In telecom, networks need to expand in terms of scale and reach to create infrastructure closer to customers. So, there is a natural amount of spend that is required...We will be spending $150 million on network, and $150 million into platform, software and other capabilities," Vinod Kumar, Managing Director and Group CEO, Tata Communications told PTI.

He further said that about half of company's total capex (capital expenditure) would be directed towards enhancing network capacity in the domestic as well as international leg.

The Tata group company, which in January announced that its Netherlands arm has invested in Teleena Holding and become the single largest holder with 35% shareholdings, said that it continues such investments in future also.

Tata Communications (Netherlands) is a fully-owned indirect arm of Tata Communications Ltd.

The investments or acquisitions  will be aimed at areas like IOT, security, cloud and mobility, Kumar said.

He said that the investments by Tata Communications in Teleena Holding has strengthened the company's capability of global mobility services, while adding there is no immediate plan to raise the stake.

Kumar informed that the debt of Tata Communications would be reduced to the tune of $300 million due to divesting of data centre, and selling of Neotel - the South African subsidiary to Liquid Telecom.

In a filing with BSE earlier, Tata Communications said that it has successfully completed the transaction of a joint venture for data centre with ST Telemedia, an international investor in media, communications and tech businesses.

The Dollar Business Bureau - Feb 14, 2017 12:00 IST