The race for India’s Hutchison Essar has heated up with Reliance Communications Ltd reported to have proposed a joint-bid with Maxis Communications Bhd for the country’s fourth largest mobile provider, and the possible entry of Britain’s Vodafone Group plc as another suitor.
According to the Indian Press, Reliance had proposed a merger with Maxis’ Indian subsidiary, Aircel Ltd, to get the Malaysian company to join the Reliance-led consortium’s bid for Hutchison Essar, whose price tag is estimated at some US$14 billion (RM49.6 billion).
The Financial Express said Maxis would be offered shares in Reliance in the proportion to the funds it brings in for the joint bid.
Maxis, along with Reliance, were reported to have submitted bids for a controlling stake in Hutchison Essar, which is 52%-owned by Hong Kong’s Hutchison Telecommunications International (HTIL), after talks that HTIL would exit the Indian market before 2008.
However, a Maxis spokesperson, when contacted, declined to comment on the reports, saying a statement on the matter would be made in the near future.
The reports said Maxis had emerged as the only operator that posed a challenge to Reliance’s bid. Reliance’s consortium currently includes four US private equity firms – Blackstone Group, Texas Pacific Group, KKR and Carlyle.
Maxis’ bid is the second made by the company after its initial US$13.5 billion bid with US private equity firm Texas Pacific Group was rejected.
It was also mentioned that Maxis had put its plans for Aircel’s rebranding exercise on hold as it could merge its Indian unit with Hutchison Essar if the company was to win the bid. With over 22 million subscribers under Hutchison Essar, the move would make Maxis the third largest mobile operator in India.
The Economic Times of India reported that Vodafone is looking to enter the race for Hutchison Essar to expand its presence in India. It currently has a 10% stake in India’s top mobile provider, Bharti Airtel Ltd.
