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Our Bureau

Chennai , April 4

AFK Sistema's plans to acquire a 49 per cent stake in Aircel, the cellular service company of the Sterling Infotech group, has not materialised.

The validity of the non-binding agreement the Russian company signed with the Sterling Group to acquire the stake expired on March 31 and has not been renewed, according to sources.

With this, the Sterling Group's efforts to find a buyer for Aircel, which provides cellular services in Chennai and Tamil Nadu circles, have also not fructified.

There are no efforts to find another buyer, according to the sources.

AFK Sistema, with interests in fixed and mobile telephone services and insurance, signed the agreement to acquire a 49 per cent stake in Aircel for $450 million (about Rs 1,960 crore). It had an option to increase its stake to 51 per cent.

The Sterling Group had signed an agreement in June 2004 to sell Aircel to Hutchison Essar South Ltd for an estimated value of Rs 1,600 crore.

This deal too did not materialise and last month both Sterling and Hutchison mutually called off the deal.

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