Orascom Telecom open to dilute stake in Hutch Int

NEW DELHI: Egyptian mobile operator Orascom has said it was open to sell a part of its 19.3 per cent stake in Hutchison Telecom International Ltd, a promoter of Indian cellular joint venture Hutch-Essar.

According to sources, Orascom is likely to shed its stake in HTIL to 12 per cent from 19.3 per cent at present. If that happens, on a pro-rata basis, its indirect stake in the Indian JV will decline to 6.21 per cent from 10 per cent now.

The stock of HTIL was down 4.8 per cent on the Hong Kong Stock Exchange to 16 HK Dollar during trading today.

Essar has been opposing Orascom's presence in the JV, saying the Egyptian firm carried security concerns.

While announcing its quarterly results yesterday, Orascom had said in a statement it owns a 19.3 per cent stake in HTIL.

"It (Orascom) remains committed to its strategic relationship with HTIL -- its corporate governance rights and operating relationship in connection with the stake purchase including representation on the board of HTIL and on the operating subsidiary boards of HTIL's most populous markets (India, Indonesia and Vietnam) as well as rights of first refusal over future share disposals by Hutchison Whampoa Ltd.

"These rights remain as long as Orascom Telecom maintains a minimum ownership of 12 per cent into HTIL," it said.

Orascom, which has been in the news for its indirect stake in India through Hutchison Essar said: "In light of current relative market valuations, Orascom continues to review all financial options including a partial sale for optimising value from its stake subject to retaining its existing corporate governance and other rights under the Shareholder Agreement with Hutchison Whampoa Ltd."