Rediff.com  » Business » Siva to exit Tata Tele, Temasek too may sell

Siva to exit Tata Tele, Temasek too may sell

November 15, 2008 16:26 IST

Days after NTT DoCoMo of Japan announced that it will buy 26 per cent in Tata Teleservices for $2.7 billion, NRI businessman C Sivasankaran has decided to put on the block his eight per cent stake in the company. Informed sources said that Temasek Holdings, too, may sell a part of its 9.9 per cent stake in the closely-held telecom services operator.

A Temasek spokesperson said: "It is inappropriate for Temasek to comment on market speculation." However, Sivasankaran confirmed that he was prepared to exit from Tata Teleservices.

Sources following the deal said that there was a possibility of DoCoMo raising its stake in the company from 26 per cent. NTT DoCoMo President and CEO Ryuji Yamada said: "We have agreed to acquire 26 per cent stake in Tata Teleservices. However, there is no intention to raise the stake from the present levels at the moment."

Huge profits await Sivasankaran if he gets the same valuation as was paid by DoCoMo. He had bought into Tata Teleservices for Rs 1,200 crore (Rs 12 billion) in 2006 and stands to make as much as Rs 4,021 crore (Rs 40.21 billion) from the sale. Temasek had paid Rs 1,500 crore (Rs 15 billion) for 9.9 per cent in the company, also in 2006.

Sivasankaran has been a key investor in the Indian telecom space and has also operated telecom services in the country, though always with the strategy of cashing out at a hefty premium.

Surajeet Das Gupta, Rajesh Kurup & Ishita Russel in New Delhi
Source: source
SHARE THIS STORY