Reliance Globalcom Acquires Struggling UK Based MVNO Vanco For $76.9 Million

Reliance Globalcom has acquired 100 percent stake in UK based MVNO Vanco for $76.9 Million. Vanco services over 220 MNC customers, including AVIS, British Airways, Siemens, Virgin Megastores; the acquisition, as per the release (pdf), takes Globalcoms enterprise customers to over 1400. Vanco Managed Network services are available in over 40,000 locations across 163 countries, and 90 percent of Vanco’s revenue is from developed markets of UK, US, France and Germany. The company has relationships with 700 carriers in 230 countries, and some long term contracts that RCom claims will add $365 million to Globalcoms revenues. Stats on Vanco here.

Bear in mind that Vanco once had a market cap of $750 million, so the $76.9 million price-tag is an indication of its current state of affairs. Trading in Vanco was suspended (details here) in the beginning of this month, when the company gave a serious profit warning. Shares had dropped on worries over “aggressive accounting”. Allen Timpany, founder and CEO of Vanco resigned on the same day and Andrew Coppel was appointed by the board as Chief Restructuring Officer. Vanco had run out of cash and had a debt of GBP 123 million (around $243 million). Globalcom acquired Vanco debt free, competing with British Telecom, T-Systems (a division of Deutsche Telekom) and Cable & Wireless.

Reliance Globalcom recently acquired 4G operator eWave World, prior to which they acquired Yipes Holding for $300 million. The company planned to invet $500 million and $200 million in 4G and Ethernet services respectively, as well as $1.5 Billion in an undersea cable network. Flag Telecom is a part of Reliance Globalcom.