Suitors eye HTIL stake of Hutch Whampoa
By TNN |
Highlights
NEW DELHI: In a bid to bypass the controversial first right of refusal (RoFR), which Essar says it enjoys if its JV partner Hutchison were to sell its 67% stake in Hutch Essar, some of the bidders in the fray are said to be exploring the possibility of picking up Hutchison Whampoa���s 49.8% stake in Hutchison International (HTIL).
Hutchison International holds 67% stake in Hutch Essar (HEL). If any of the bidders were to be successful in acquiring Hutchison Whampoa���s (HWL) 49.8% stake in HTIL, it could indirectly give them a controlling stake in HEL. International media reports said Vodafone and Reliance Communications were studying the possibility of such a deal.
Both the companies refused to comment on the issue. However, sources told ET that both Reliance and Vodafone preferred a direct buyout of HTIL���s stake in HEL, rather than following a complicated indirect strategy. ���The parent company has stake in Hutch���s operations in several countries. Vodafone, on the other hand is only looking at HTIL���s stake in Hutch-Essar,��� says a Vodafone source.
In addition, this game plan could also lead to further complications as Orascom, which holds 19.3% in HTIL, has said it has RoFR in HTIL. ���In order to circumvent one RoFR, the bidders may walk into anothee RoFR,��� says an industry source.
What accentuates the complication is that Orascom has also expressed interest in buying out HTIL���s stake in HEL, and the company is awaiting the Indian government���s clearance on security-related issues before placing its bid. The Ruias, meanwhile, have roped in Zia Mody���s AZB & Partners, one of India���s top law firms specialising in mergers and acquisitions, to represent its case if its RoFR is infringed.
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