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Home  » Business » Essar offers $11 bn for HTIL's stake

Essar offers $11 bn for HTIL's stake

Source: PTI
December 28, 2006 11:02 IST
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Indian corporate house Essar has offered to buy out foreign partner Hutchison Telecom (HTIL)  from the mobile joint venture Hutch-Essar for $11 billion (about Rs 50,000 crore), putting  the enterprise value at $16.5 billion, reports in the British media said.

"Essar, the Indian conglomerate that holds a 33 per cent stake in Hutchison-Essar, has offered $11 billion for the rest of the company, the fourth largest in the Indian mobile market," the Financial Times reported on Thursday.

The UK-based daily's online edition said "Vodafone on Wednesday faced a new rival in its drive to win control of Hutchison-Essar after a minority shareholder (Essar) turned the battle for control of the Indian mobile operator into a three-way fight."

Going by earlier reports, the offer by Essar, whose vice chairman Ravi Ruia was in Hong Kong earlier this week, would be far short of expectation of HTIL, which wants to sell its 67 per cent stake in the Indian venture.

Besides Ruia, British telecom major Vodafone's CEO Arun Sarin too was in town for talks with Hutchison Telecom International Ltd, informed sources said.

The 'FT' had reported on Wednesday that Hutchison Whampoa, the parent company of HTIL, will only entertain offers "well in excess of $14 billion ".

The report had quoted Frank Sixt, Hutchison Whampoa's finance director, as dismissing an indicative offer of $13.5 billion private equity firm Texas Pacific Group and Malaysian telecom operator Maxis, saying "that is not a valuation that would excite us".

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