Acme eyes private equity funds, could sell out on right valuation

Written by Rajaty Guha | New Delhi | Updated: May 20 2011, 08:17am hrs
Passive infrastructure and energy conservation solutions provider Acme Tele Power is looking for investments from private equity players. The company, which grew rapidly till 2008 on the back of the telecom boom, is finding the going tough since the last two years and is even open to exiting if it finds a buyer and an attractive valuation. The company's valuation would not be more than R400 crore.

Industry sources said Acme had mandated Ernst and Young in 2009 to sell a majority stake but shelved plans since it could not get the desired valuation.

In 2008, the company won private equity financing with some major players picking up stakes prior to its listing plans. With the IPO plans falling through, PE players left the company. Sources said though the business model of the company is sound and its performance reasonably well, it is facing problems in scaling up its business. With low margins in passive infrastructure, it may be facing cash flow problems, industry sources said.

The information is incorrect. We are not looking at selling our assets. Instead, we have lined up investments for the growth of our telecom business, the spokesperson said.

Established in 2003, Acme Tele Power is promoted by Manoj Kumar Upadhyay, who has worked in the power and telecommunications industry for 14 years.

Originally, Acme operated as a provider of passive infrastructure products and installation and maintenance services to wireless telecommunications service providers.

In 2007, it began to expand the scope of its business to include the provision of energy management services and turnkey solutions to telecommunication operators.

In 2007, it acquired Norway-based telecom infrastructure company Reime, a leading supplier of passive infrastructure to telecom operators in West African countries.

Its six operating companies are registered as limited liability companies, located in Kenya, Tanzania and Uganda in east Africa and Nigeria, Ghana and Ivory Coast in west Africa.