Mumbai, Feb 10: The race for Hutchison Essar Ltd (Hutch-Essar) acquired a new twist today with the Hindujas reported to have roped in Qatar Telecom and Russian telecom major Altimo as partners.
The combine will now jointly fight three others that include Reliance Communications (R-Com), Vodafone Group Plc and the Essar group, who are interested in acquiring Hutchison Telecommunication International Ltd’s (HTIL) 67 per cent stake in Hutch-Essar.
Interestingly, the Hinduja consortium is understood to have put in a “binding bid”. This means that the group is committed to adhere to the terms of its offer and that includes the price. However, the nature of bids submitted by the other players could not be ascertained.
The bid from Hindujas and the others could be considered by the HTILboard tomorrow. HTIL could then place them for shareholders’ approval on February 15.
Reports say Hutchison Telecom is keen to identify a preferred bidder by the Lunar New Year that falls on February 17.
Sources keenly monitoring the saga, however, observed that a final decision on the issue could still take some time though the front-runners would be known on Sunday.
Qatar Telecom’s interest in the Hutch-Essar bid has been known for quite some time. Doha-based Qatar Telecom, which is the sixth-largest telecommunication company in the Gulf, has been looking to expand its footprint beyond West Asia.
As part of this strategy, it had recently entered a deal with ST Telemedia — a communication company that has operations in Asia Pacific — to acquire a 25 per cent stake in Asia Mobile Holdings (AMH) Pte Ltd. AMH currently holds ST Telemedia’s stakes in StarHub Ltd, Singapore’s second largest info-communication company, and PT Indosat Tbk, Indonesia’s second largest operator.
The suitors for HTIL’s 67 per cent stake were asked to submit their bids by Friday. While all the four submitted their respective offers, the initial proposals, are said to be “conservative” in nature. It is understood that bids were in the range of $16 billion to $17 billion for the entire 100 per cent of Hutch-Essar.
When asked whether the entry of Altimo and Qatar Telecom would strengthen the Hinduja group’s chances, an official, whose company is now in the race, said much would depend on how far the suitors were willing to go.
When the Hindujas announced their intentions of entering the race for Hutch-Essar, group chairman Ashok0 Hinduja had said they were keen to obtain at least a majority stake in the Indian telecom joint venture even as they are open to acquire 100 per cent of the company.
Last year, the Hindujas had sold their 5.11 per cent stake in Hutch Essar to Hutchison. They had then offered to buy HTIL’s entire stake in the joint venture.