Tatas plan to develop part of VSNL realty

The Tata group is planning to unlock the real estate value of Videsh Sanchar Nigam Ltd (VSNL), almost three years after taking over the government-controlled company.

The telecom company, barring the disputed 773 acres of surplus land, has decided to develop part of the property it owns over the next three years for "its own corporate purpose".

Tata group sources said, "VSNL has in its possession huge real estate spread across prime locations in the country that are underutilised. We intend to develop them over the next three-four years for our own purpose". However, it is yet to be decided how much land will be finally developed.

The telecom company plans to set up internet data centres in Mumbai, Delhi and Chennai. Apart from these centres, it plans to build offices particularly catering to broadband services. The broadband business is a major thrust area for VSNL.

It plans to be a significant, large-volumes, triple-play broadband player offering integrated voice, data and video services. The company will also focus on small cities where it is busy building local area networks.

While several projects are being thought by the Tata group for VSNL, it is giving a face-lift to existing VSNL offices. The interiors at several VSNL offices now sport a swanky look with office space used judiciously.

Meanwhile, VSNL is awaiting government's decision on the issue of de-merging the surplus 773 acres of land into a separate company under the terms of the share purchase and shareholders' agreement signed at the time of VSNL's privatisation.

It was agreed that certain land that VSNL owns at Pune, Kolkata, New Delhi and Chennai would be demerged into a separate company. The shares of the resulting company will then be distributed pro-rata to VSNL's existing shareholders.

However, the department of telecommunications has sought legal opinion of the Solicitor General on the matter and has accused the Tatas of delaying in the formation of a separate company.