Telecom News --

Tata Communications and China Entercom Communications withdraw equity joint venture application

Mumbai, 10 June, 2010

Tata Communications (Hong Kong) Ltd, a wholly-owned indirect subsidiary of Tata Communications Ltd and the shareholders of China Entercom Communications Ltd (CEC) have jointly withdrawn their Equity Joint Venture application with the Chinese Government. Both organizations have mutually agreed to terminate the various agreements memorializing Tata Communications’ equity investment in CEC.

CEC and Tata Communications will continue with their existing network services co-operation relationship and have also entered into a new co-operation agreement whereby Tata Communications and CEC will work together on a commercial basis to allow Tata Communications to benefit from access to CEC’s network and assets in China, as Tata Communications continues to focus on this key market.

Speaking on the development, Srinivasa Addepalli, Senior VP, Corporate Strategy, Tata Communications, said, “The parties mutually agreed to withdraw the EJV application due to the uncertainty of whether any regulatory approvals from the Chinese Authorities were forthcoming. While the EJV has been called off, we will continue to work with CEC to further our plans in China. Our commercial relationship with CEC continues to give us network access in China, which serves our customers seeking connectivity into this geography.”

"China is a priority market for Tata Communications and we will continue to actively evaluate long-term investment opportunities in this region," concluded Mr. Addepalli.

Commenting on the termination of the agreement, Ms Sun Yinghong, COO, CEC, said, “This mutual withdrawal of the EJV application will not deter us from working closely with Tata Communications to provide a superior class of network services to our customers in China as well as to those businesses seeking to expand into the country.”

Through the co-operation with CEC, Tata Communications will provide VPN services to the main cities of China. This reach complements Tata Communications' global VPN presence. The organization has also recently introduced Ethernet services to global enterprises and carriers wanting to connect to China and has existing MPLS and International private leased circuit capabilities into the country through local partners.

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