Vodafone buys out Essar in India for $5bn
Friday 01 April 2011
Vodafone and Essar have settled a dispute over its Indian joint venture with the UK mobile giant agreeing to buy out its partner in a deal worth $5bn (£3bn).
In a statement released yesterday, Vodafone said it had exercised its put option to buy out Essar's 33 per cent stake in the business. The deal will complete before November.
This marks the end of a rocky alliance between the two companies. Vodafone Essar is the second largest mobile operator in India by revenues.
The UK company paid $10bn when it bought 67 per cent of the group from Hutchison in 2007.
In January, simmering tensions over the so called "put option" broke out into open warfare as Essar accused Vodafone of trying to force it out of the venture at an "artificially" low price. At the time of the deal, the put option was agreed to sell the entire stake to Vodafone for $5bn or sell a smaller stake at an independent valuation.
Through a complex transaction Essar wanted to combine a third of its 33 per cent holding with a publicly listed Indian company to establish a value for its stake on the market.
Vodafone tried to block the move as it feared it would artificially inflate the price and Essar took the matter to the Madras High Court.
Following yesterday's deal, Vodafone said it would sell its stake down to 74 per cent to comply with Indian rules over foreign ownership.
- 1 President of Argentina adopts Jewish godson to 'stop him turning into a werewolf'
- 2 Downfall of Dustin 'Screech' Diamond, the 'Saved By The Bell' star charged with bar stabbing
- 3 The 'Black Museum': After 150 years, public set to see exhibits from police’s grisly crime museum
- 5 Sir Winston Churchill’s family begged him not to convert to Islam, letter reveals
President of Argentina adopts Jewish godson to 'stop him turning into a werewolf'
Downfall of Dustin 'Screech' Diamond, the 'Saved By The Bell' star charged with bar stabbing
Syrian teenager Usaid Barho reveals how he escaped from Isis using a suicide vest
Sir Winston Churchill’s family begged him not to convert to Islam, letter reveals
UK weather: 'Coldest night of the year' tonight as freezing temperatures plummet to -10C
Millions of Britons struggling to feed themselves and facing malnourishment
British actor Idris Elba cannot star as James Bond because he is black, says shock jock Rush Limbaugh
Ukip member gets into Christmas spirit with Union Flag plea to Santa 'for our country back'
Germany anti-Islam protests: 17,000 march on Dresden against 'Islamification of the West'
Nigel Farage: Ukip leader named 'Briton of the year' by The Times
Douglas Carswell tells Ukip to stop blaming foreigners as youth poll shows Nigel Farage is even less popular than Nick Clegg
iJobs Money & Business
Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...
Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...
Not specified: Selby Jennings: SVP Model Validation This top tiered investment...
Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...