Chandigarh, May 20 :     Modicorp, the cellular services provider in Calcutta, today bought the entire 49 per cent stake of Telstra, its foreign partner, and plans to come out with an initial public offering (IPO) of 10 per cent. Dilip Modi, CEO of the Modi Telstra cellular venture, said: 'We have bought the entire 49 per cent stake of Telstra. The board of directors which met today also decided to offer the cellular service under a common brand name - Spice Telecom. The deal was decided without any third party mediation.' Modicorp of the BK Modi group and its associates had a 51 per cent stake in the cellular venture. Earlier this year, the company had signed a memorandum of understanding with Telstra for the acquisition of the latter's stake. 'Now we will be able to draw on the synergies with Punjab and Karnataka cellular operations of Modicorp and its associates.,' Dilip Modi said. Spice Communications, another BK Modi group company, operates two cellular circles in Karnataka and Punjab. 'The proposed acquisition was on the cards for sometime,' said Modi. 'Telstra wanted to focus on providing global services to corporate customers throughout Asia.' Modi Telstra claims it has a market share of 55 per cent in Calcutta and 54.6 per cent in Karnataka; Spice in Punjab has one lakh registered subscribers. The combined subscriber base of Spice will now go up to 2.5 lakh. With 14 of the 15 districts networked, Spice Punjab has achieved 90 per cent coverage in the state while Spice Karnataka covers 85 per cent of the state districts. The Spice networks in Punjab and Karnataka cover over 1300 villages. According to Modi, the total investment in Modi Telstra is Rs 158 crore of which Rs 133 crore is shareholders' contribution while the remaining Rs 25 crore is in the form of long-term borrowings. The company also announced a major expansion initiative to enhance its presence in the cellular market in India. 'Mergers and acquisition of available cellular operations in India will be at the forefront of Modicorp's strategy for expansion. A unique highlight of this M&A strategy would be 'flexibility' and 'customisation' in the ownership pattern to suit the interests of the merging operators,' said Dr Abid Hussain, director on Modicorp board. BK Modi, chairman and CEO of Modicorp, said: 'Acquisition of Telstra's equity is in line with our strategy to become a formidable player in the Indian cellular market. Today Spice is a high performing and successful company and it makes business sense to capitalise on our human and technical resources and brand equity nurtured over the years. Given the opportune time, when the Indian cellular industry is going through a phase of consolidation, we will continue to explore all possible opportunities that come our way. We are bullish about Spice becoming a lead player in the Indian telecom and wireless internet arena.' Modicorp will now focus on telecommunications, information technology and the internet as strategic thrust areas for developing a synergistic business portfolio.