'Vodafone to place Hutch bid soon'
Vodafone CEO Arun Sarin says his company would place a bid for Hutchison Essar, within "some weeks".
By TNN |
NEW DELHI: Vodafone Group Plc’s chief executive officer Arun Sarin on Wednesday said the UK-based communication major would place a bid for India’s fourth largest telecom company, Hutchison Essar, within “some weeks”.
He also said that Vodafone was keeping its options open on entering into a partnership with Essar, which has a 33% stake in HEL. “Absolutely,” was Mr Sarin’s reply when asked whether Vodafone would join hands with Ruias-promoted Essar, who he termed as a good partner.
Regarding the time-frame for the completion of the deal, Mr Sarin said it was “for seller (Hutchison International) to complete the process and not him.” Replying to another query, Mr Sarin said that Vodafone will bid for “whatever (stake) is available (in HEL)...”
Mr Sarin declined to comment on the price. He said the company has already “started examining the books of Hutch Essar and would finish the exercise within a couple of weeks,” while adding that India was a growing market that “fits well in Vodafone’s plans.”
During the day, Mr Sarin, accompanied by Vodafone’s CEO for global business development, Warren Finegold, and, director external operations Matthew Kirk, held talks with Bharti Airtel chairman Sunil Mittal, commerce and industry minister Kamal Nath, finance minister P Chidambaram and communications and IT minister Dayanidhi Maran. Government sources said Mr Sarin and his team had briefed these Cabinet ministers about the company’s future plans and interest in India’s fast growing telecom sector.
The Vodafone CEO put an end to speculation regarding the company seeking clarity on India’s FDI. “FDI rules are clear, there is clarity.... our meeting was fruitful,” he said, following his interaction with commerce minister Mr Nath. According to a commerce ministry official, Mr Nath during the meet had told the Vodafone CEO that “any takeover bid should be in the interest of all stakeholders, be transparent and must involve the best commercial practices,” a ministry official told ET.
Amidst mounting speculation that Vodafone had already begun talks for disengagement from Bharti, Mr Sarin refused to comment on the issue: “Bharti is our partner. We keep meeting them. Business with Bharti has been good,” he said, when asked about his interaction with Mr Mittal. Bharti chairman Sunil Mittal told reporters after meeting Mr Sarin that “there was no question of Vodafone selling its 10% stake in Bharti at the moment.”
He also said that Vodafone was keeping its options open on entering into a partnership with Essar, which has a 33% stake in HEL. “Absolutely,” was Mr Sarin’s reply when asked whether Vodafone would join hands with Ruias-promoted Essar, who he termed as a good partner.
Regarding the time-frame for the completion of the deal, Mr Sarin said it was “for seller (Hutchison International) to complete the process and not him.” Replying to another query, Mr Sarin said that Vodafone will bid for “whatever (stake) is available (in HEL)...”
Mr Sarin declined to comment on the price. He said the company has already “started examining the books of Hutch Essar and would finish the exercise within a couple of weeks,” while adding that India was a growing market that “fits well in Vodafone’s plans.”
During the day, Mr Sarin, accompanied by Vodafone’s CEO for global business development, Warren Finegold, and, director external operations Matthew Kirk, held talks with Bharti Airtel chairman Sunil Mittal, commerce and industry minister Kamal Nath, finance minister P Chidambaram and communications and IT minister Dayanidhi Maran. Government sources said Mr Sarin and his team had briefed these Cabinet ministers about the company’s future plans and interest in India’s fast growing telecom sector.
The Vodafone CEO put an end to speculation regarding the company seeking clarity on India’s FDI. “FDI rules are clear, there is clarity.... our meeting was fruitful,” he said, following his interaction with commerce minister Mr Nath. According to a commerce ministry official, Mr Nath during the meet had told the Vodafone CEO that “any takeover bid should be in the interest of all stakeholders, be transparent and must involve the best commercial practices,” a ministry official told ET.
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Amidst mounting speculation that Vodafone had already begun talks for disengagement from Bharti, Mr Sarin refused to comment on the issue: “Bharti is our partner. We keep meeting them. Business with Bharti has been good,” he said, when asked about his interaction with Mr Mittal. Bharti chairman Sunil Mittal told reporters after meeting Mr Sarin that “there was no question of Vodafone selling its 10% stake in Bharti at the moment.”
He also said “the question does not arise,” when asked if Singapore Telecommunications — which owns 30.8% in Bharti Airtel — was involved in discussions with Vodafone. Mr Mittal added that Bharti and Vodafone were yet to discuss the terms of disengagement.
A Vodafone spokesperson said Mr Sarin’s visit was “important,” as he was “had come to understand what senior political and regulatory officials feel about the market in India.” He has pointed out to government officials here that Vodafone has considerable experience of operating in India and good track record with its Indian partners, the spokesperson added.
According to a Vodafone source, Mr Sarin, during his interaction with Mr Maran had assured the communication minister that the company “was committed to bringing all economic and social benefits of mobile telephony to citizens both in urban and rural areas”. Mr Sarin is slated to fly down to Mumbai on Thursday evening where a team of senior Vodafone executives is already present.
Interestingly, Mr Mittal also met Mr Chidambaram later in the day, but Bharti executives refused to reveal the nature of the discussions. Meanwhile, international media said the interest among private equity firms who too were in the race to bid for HEL had waned due to the “inflated price tag” being attributed to HEL.
In fact, reports also quoted sources in the know saying that buy-out firms were unlikely to take part in any bid that valued HEL above $15 billion.
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