Vodafone confirms its plans to acquire Hutch

LONDON: It's finally happened. Vodafone has finally confirmed that it is planning to jump into the fray for acquiring Hutch Essar, along with Reliance. "The board of Vodafone is considering the acquisition of a controlling interest in Hutch Essar in India. Such a transaction would be consistent with its stated strategy of seeking selected acquisition opportunities in developing markets," the company said in a statement.

The process is at an early stage, and it may or may not lead to an transaction it further clarified.

Vodafone, a company not usually given to comment on speculation, made its position clear after consistent media reports that its board is meeting to consider making a $13 bn for Hutch Essar, and affected its share price negatively.

Vodafone has interests in emerging markets including Egypt, Romania and India - and underlined its ambitions for further expansion in similar markets at an investor meeting earlier this month. Vodafone's board believes that India's mobile market has great potential, the company said, justifying its interest.

The news came after it unveiled a £3.3bn half-yearly loss in November as it was hit by higher interest rates, competition and some of its assets being worth less than it thought.

After Corus, this makes Hutch Essar the second planned takeover that moves into contested territory, and may spark off another bidding war with Reliance Communication.