Business Daily from THE HINDU group of publications
Wednesday, May 30, 2007
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Business Daily from THE HINDU group of publications Wednesday, May 30, 2007 ePaper |
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New Delhi May 29 World's largest mobile phone company by revenues Vodafone Group Plc on Tuesday said it expects to complete selling part of its stake in Bharti Airtel Ltd by November 2008. Vodafone will sell 5.6 per cent stake in the country's largest mobile company for $1.6 billion to Bharti's promoters.
Two parts
The share will be sold in two parts. The first part will be completed by March 2008. The deal, which was announced in February, values Bharti's shares at around Rs 601, which is at a discount compared to its share price on the Bombay Stock Exchange, which closed at Rs 835.5 on Tuesday and at Rs 728 per share on Februray 12, when the deal was announced first. While Bharti promoters get a discount, Vodafone has also doubled the money it invested in Bharti in less than two years. Vodafone had purchased almost 10 per cent stake in Bharti in October 2005, paying $1.5 billion, or Rs 351 per share. The UK-based company will retain an indirect 4.4 per cent holding in Bharti Airtel.
Larger deal
The sale of the 5.6 per cent stake to the promoters of Bharti was part of a larger deal in which the Newbury, England-based company purchased a controlling interest in India's fourth-biggest wireless carrier Hutchison Essar. Vodafone and Bharti also have an agreement to share infrastructure such as towers and shelters to reduce expansion costs in India. Vodafone is expected to completely take charge of Hutch's operations by the next quarter. The company plans to introduce its brand gradually even as it rides on Hutch's visibility initially. Vodafone is also planning to bring in its low cost handsets by the end of the year.
More Stories on : Telecommunications | Stocks | Bharti Tele-Ventures Ltd
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