Wednesday, July 20, 2005

Essar buys 64% in BPL

The Essar group one of the leading brands in the mobile phone segment acquired a 64 pct stake in BPL Communications Ltd for over 44 bln rupees, in one of the largest acquisitions in the Indian telecom sector. The agreement was signed after highly competitive bidding by seven to eight foreign players, besides some very keen Indian players in the field. The deal follows Essar's recent consolidation of its position in its joint venture with Hong Kong-based Hutchison Telecom, operating in India under Hutch brand, by acquiring an additional 3.4 pct equity. Essar plan to merge the two big brands Hutchinson and and Essar with Hutchison to retain it majority stake in the merged entity. Hutchison, which holds 53.4 pct in Hutchison Essar, is believed to have agreed to chip in funds in the merged entity at a later stage.