The Hindu Business Line : With Temasek picking up stake

MOBILE services company Idea Cellular has shelved its plans for an initial public offering (IPO) for now. The move follows a change in the company's shareholding pattern, with the Temasek Holding companies, Singapore Technologies, Telemedia Pte and Telekom Malaysia, picking up the 33 per cent stake held by AT&T.

Earlier this year, Idea Cellular's board had asked its management to prepare for an IPO between June and September 2004. Senior company executives told Business Line that though it was looking at various options to raise funds, the proposed IPO was not happening immediately.

Company sources said that the main purpose of going for an IPO was to allow the US telecom major AT&T an exit route by monetising its equity holding in Idea Cellular.

But with Temasek picking up AT&T's stake, an IPO was not on the agenda of the company.

The company's board will now look at the option of listing its shares afresh at a later stage, as and when funds are required.

It has completed most of the background work like preparing the prospectus, which is required for listing.

The sources also said that the two Indian partners, the Tata Group and the Birla Group, might dilute their stake in the company by 8 per cent each in favour of Temasek Holdings, which would bring up the foreign holding in Idea Cellular to 49 per cent.

Post-restructuring, the Tatas and the Birlas are expected to have a 25.5 per cent stake each in the mobile services company.

Idea Cellular is also understood to be in the race for picking up a stake in the Tamil Nadu-based Aircel.

The company has announced its plans to acquire BPL Mobile in Mumbai.

It had recently concluded the biggest acquisition in the Indian wireless industry by taking a 100 per cent stake in Escotel Mobile Communications, giving it ownership of six telecom circles.

Of this, the company may surrender three non-functional licences to the Department of Telecommunications.

The company's combined revenues are estimated to be in the range of Rs 1,600-1,700 crore.

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With Temasek picking up stake — Idea Cellular shelves IPO plans