Malaysian firm eyes Idea Cellular
Malaysia Khazanah is in talks to buy a one-third stake in Indian mobile phone operator Idea Cellular.india Updated: Apr 15, 2006 11:06 IST
Malaysia's state investment firm is in talks to buy a one-third stake in Indian mobile phone operator Idea Cellular Ltd, a financial magazine reported, in a second Malaysian attempt to buy into the firm.
Khazanah Nasional Bhd might take up a 33 per cent stake conglomerate Aditya Birla was selling in Idea, India's fifth-biggest mobile player with 7.4 million users, Malaysia's Edge weekly said, quoting unnamed sources.
Birla, which recently doubled its stake to 98 per cent of unlisted Idea, has said it wanted to cut its holding back to 65 per cent, but not through a sale to another mobile operator.
"Khazanah would be a good bet for Birla as it is a financial investor with government links," the Edge quoted an industry observer as saying.
Khazanah officials were not immediately available for comment on plans for Idea, a $2 billion firm that competes with larger carriers such as Bharti Tele-Ventures Ltd.
India, the world's fastest-growing mobile phone market, has seen a spate of mergers in the past two years in the fragmented and highly competitive sector, which has extremely low local call rates.
The high growth potential of India, with only around 90 million mobile phone customers in a country of more than 1 billion people, has caught the eye of international telecoms firms. Around 5 million more mobile users sign up each month.
Last June, Telekom Malaysia Bhd failed to win approval from Indian authorities to buy 47.7 per cent of Idea for $380 million. It had bid jointly with Singapore Technologies.
Telekom, Malaysia's dominant phone firm, is controlled by Khazanah. In March, Telekom bought a 49 per cent stake in a smaller Indian mobile firm, Spice Communications Ltd, for $178.8 million.
Birla has upped its stake in Idea by buying a 48.12 holding from another conglomerate with telecoms interests, Tata, this month for $986 million, suggesting a value of $2 billion for the whole of Idea.
First Published: Apr 15, 2006 11:06 IST