Vodafone to bid for Hutch in Feb

DAVOS: The race to acquire majority stake in Indian telecom company Hutchison Essar is expected to hot up in February. While Vodafone has said that it would submit a formal bid in February, due diligence for the same has also been initiated by the Hindujas.

���We expect to submit a formal proposal sometime in the next month,��� Vodafone group CEO Arun Sarin told SundayET. He said that the due diligence for the same was being undertaken. It is expected that due diligence process would be completed by the end of the next week. It is learnt from sources that the company has not engaged any consultant to do the due diligence.

Meanwhile, official sources in the Hinduja group confirmed that the group was interested in picking up an equity stake in the Indian telecom company. ���The process is on,��� an official in the group said.

Mr Sarin accepted that the entry of ���so many players��� had pushed up valuations. ���But we're serious,��� he said. Besides the Hindujas, Anil Ambani-owned Reliance Communications and Russiaan firm Altimo are among interested parties, eying at about 67% equity stake of Hutchinson Whampoa of Hong Kong in Hutch Essar.

A sources in Vodafone group, confirmed the move. ���The board of Vodafone continues to believe the mobile market in India has great potential and is, therefore, considering the acquisition of a controlling interest in Hutch Essar. Such a transaction would be consistent with its stated strategy of seeking selective acquisition opportunities in developing markets,��� it said.

Vodafone, which also holds about 10% equity stake in Bharti Airtel, would require to get an approval from the company before acquiring a stake in rival company Hutch-Essar. Mr Sarin has, however, specified that the issue would be resolved through talks.

Sources said that Bharti group chief Sunil Mittal is quite open in this regard. It is understood that in informal interaction in Davos, Mr Mittal has conveyed that he would have no objection in Vodafone acquiring Hutch Essar. It is expected that various issues related to Vodafone���s proposed acquisition would be discussed at a meeting between minister of state for commerce Ashwini Kumar and Mr Sarin. Mr Kumar confirmed that Mr Sarin would be meeting him in the afternoon of Saturday.