Vodafone's Sarin hopeful of Bharti's cooperation
Vodafone has 9.9 per cent stake in Bharti group's telecommunication venture and will need a nod from the company before acquiring a stake in rival Hutch-Essar.india Updated: Jan 27, 2007 13:31 IST
Vodafone's chief executive Arun Sarin has said that Bharti Airtel is "quite open" to the fact that the British telecom major is fighting it out in Airtel's rival firm Hutch-Essar.
Vodafone has 9.9 per cent stake in Bharti group's telecommunication venture and will need a nod from the company before acquiring a stake in rival Hutch-Essar.
The two companies have a non-compete clause in the agreement and Vodafone has to seek Bharti's permission before buying a stake in a rival company.
Vodafone's Indian-born chief executive, who has already been authorised by the company board to take steps as he deems fit on the Hutch-Essar takeover bid, said he has not yet spoken on offloading stake in Bharti group's telecom venture.
"We will talk about that when the issue arises. For the moment, Sunil has told us he is quite open," Sarin told on the margins of the World Economic Forum (WEF) meetings in Davos.
"Our due diligence process is currently underway. Once we get the report, which could be any time next week, we'll be submitting a formal proposal. It will be sometime early next month," he added.
"Yes, the entry of so many players has pushed up valuations. But we're serious," said the alumnus of the Indian Institute of Technology (IIT), Kharagpur.
Sarin also said Hutch-Essar was an exciting prospect for Vodafone even if it means an aggressive bid to get a foothold in one of the fastest growing economies in the world, especially in the telecom market space.
"Vodaphone has aspirations of running a telecom business in India and having some management say. But that is not available in the Bharti group. So we have no problems if they look elsewhere," Mittal had earlier said who was on Friday named for the Padma Bhushan award and is among the four co-chairs at the WEF's ongoing annual meeting.
He, however, said there were no official talks as yet. The board of Bharti, in fact, also appreciated the fact that Vodafone officials chose to abstain from participating at their board meeting in view of their plans in a rival firm.
Anil Ambani's Reliance Communications (RCOM), the Hinduja group and Russia's Altimo are among those interested in acquiring the 67 per cent stake that the Hong Kong-based Hutchison Whampoa has in Hutch-Essar.
Prakash P Hindujasaid his group was keen on Hutch-Essar. "We are serious. That's why we entered the fray," Hinduja said, adding the due diligence process had started.
Incidentally, the Hindujas had exited Hutch-Essar last June by selling their 5.11 per cent-stake for $450 million.
However, all eyes are now on the board meet of Hutchison Telecom International Ltd (HTIL) that is scheduled to take place on Jan 29 in Hong-Kong.