Hutch sale starts, bids in, auction follows
The battle to buy Hutchison Essar entered a decisive stage on Friday, with three of the four contestants in the fray meeting the midnight deadline for submitting their rival bids. All three bids have been submitted by e-mail.india Updated: Feb 10, 2007 12:13 IST
The battle to buy Hutchison Essar entered a decisive stage on Friday, with three of the four contestants in the fray meeting the midnight deadline for submitting their rival bids. All three bids have been submitted by e-mail.
On the block is the Hong Kong-based Hutchison Telecommunications International Ltd’s (HTIL) 67 per cent stake in the telecom major, for which the British telecom giant Vodafone Plc, the Anil Ambani-owned Reliance Communications Ltd, Essar, which controls the remaining 33 per cent stake, and the Hindujas are all vying. The first three have submitted their bids, while the Hindujas, who completed their due diligence on Friday, are also in the race.
An HTIL board meeting was likely to be called on February 11 to approve the bidding process, said sources close to the deal. This will be followed by an extraordinary general body meeting (EGM) soon after.
These sources said the first two bids were in the vicinity of $18-20 billion (Rs 81,000-90,000 crore), while Essar’s was somewhat lower.
The Essar group, which has the first right of refusal over HTIL’s 67 per cent stake, has reserved its rights and participated in the bidding process. Sources close to Essar said they had tied up with Stanchart and Citigroup for financial assistance, which would be above $16 billion.
“We have been informed that after receiving the bids, HTIL will reveal the highest price offered to each of the remaining bidders separately,” said one of the bidders, adding: “Each will be asked if they want to revise their bid. It will be very similar to the bidding over Corus, except that, in that case, the United Kingdom’s Takeover Panel was the regulator. In this case HTIL will handle the bidding itself.”