Spice Communications is open to all offers, including stake sale, and is currently waiting for a proposal from Telekom Malaysia before it takes a decision, its chairman said. Telekom Malaysia (TM) holds 39.2 percent in the Indian telecom services provider. Spice, which currently has operations in two of the 23 telecom circles, needs funds to expand.
“We have got four new licenses and are hoping to get more. We have to expand company's capital and total investment,” Bhupendra Modi told reporters on the sidelines of annual shareholders meet. Modi said although firms like UAE's Emirates Telecommunications (Etisalat) have been in talks with Spice, he was waiting for an offer from TM as Indian laws permit a maximum of 74 percent foreign holding in telecoms. “As TM has already 39 percent, any restructuring on the foreign side has to be done with TM.
So it is TM who has to finally decide and then they will propose to us,” Modi said. Spice is open to TM raising its stake to 74 percent or bringing in new partners. India, the world's fastest-growing mobile services market and the second-largest market after China, has lured foreign firms like Vodafone Plc, which last year bought a controlling stake in the third-largest local cellular firm. SingTel , Southeast Asia's top phone firm, owns more than 30 percent of market leader Bharti Airtel.
Others like Etisalat, AT&T have been looking forward to make inroads in India. “As and when they (TM) will be ready, I will talk to them…Once they have found a solution, I will not take more than 48 hours,” Modi said. He, however, said he will not like any offer below 60 rupees a share. “That was the price at which the share was quoted just after the initial public offering…I have committed to shareholders not to make a deal below 60,” Modi said.
Asked if he was ready to part away with the company, he said, “Today in a dynamic world you cannot be emotional. We are a mature business and are open to all offers.” Shares of the company closed 2.3 percent down at 57.25 rupees in a weak Mumbai market.
Source: Economic Times