Ajay Piramal-controlled Piramal Healthcare and a group of investors led by Max India chairman Analjit Singh are set to make a killing on their investments in case Vodafone Plc buys them out in order to raise its stake to 100%.
Piramal may get around `8,300 crore on its investment of `5,863 crore. In August 2011, the company bought 5.5% stake in Vodafone India for `2,856 crore. Later, in February 2012, it bought another 5.5% equity for `3,007 crore, raising its equity to 11%.
According to Vodafone’s annual report, the company has an agreement to buy Piramal’s 11% stake for `8,300 crore if Vodafone fails to come up with an initial public offering (IPO) by February 2014.
Piramal bought equity in the company when Essar exited from its JV with Vodafone called Vodafone Essar.
Though the exact equity owned by Max India founder Analjit Singh is not known, he owned 6.2% stake before Essar group formally exited the company. “Our Indian partners are Piramal and group of investors led by Analjit Singh,” said a Vodafone India official without disclosing the exact equity structure owned by Analjit Singh.
It is not yet known at what price will Vodafone buy Analjit Singh’s stake. If we assume that the amount paid to Analjit Singh is on a par with Piramal, then Analjit led investors should get close to `11,318 crore for their 15% equity.