Investment In RCL On Track, Says Qualcomm

Mumbai: | Updated: Jul 31 2002, 05:30am hrs
Qualcomm Inc will go ahead with its investment in Reliance Communications Limited (RCL) as originally scheduled. Contrary to speculation that the deal may be off, sources in Qualcomm India have said that the investment is on track. “Our investment in Reliance is clearly related to the progress of the CDMA project in the company,” they added.

San Diego-based Qualcomm Inc announced its intention of picking up a four per cent stake in RCL earlier this year. This stake was picked up for $200 million valuing RCL at $5 billion.

Sources indicated that there has been a slight delay at Reliance’s end which has marginally slowed down the rollout plans.

“The delay has been on account of various things including the passing away of the chairman of the group,” they said.

Sources in Qualcomm clarified that they continue to be with Reliance and “do not stand to lose on account of this delay.”

While there has not been any investment that has come in so far, it is learnt that this will depend heavily on the orders placed and subsequent rollout plans.

There has been no communication from Reliance on launch dates. When contacted, the Reliance spokesperson declined to comment on the issue.

Reliance is expected to place the final order for equipment relating to infrastructure and cell sites shortly. “Negotiations between Reliance and the suppliers are at an advanced stage and the deal should be concluded anytime now,” sources said.

Qualcomm is a world leader in the CDMA technology which is used to provide the Wireless in Local Loop (WLL) services.

Reliance will pay Qualcomm for the technology that will eventually be used.