State-owned Bharat Sanchar Nigam Ltd (BSNL) is likely to exit the consortium comprising Delhi-based Vavasi Group and Malaysia's Al-Bukhary to acquire 46 per cent in Kuwait's Zain Telecom.Talks, which have been on for two months, have fallen through over valuations, and Vavasi is expected to announce a new consortium partner in a week or two. Vavasi Group Managing Director Farid Afruddin declined to comment on this information.
Vavasi group, a New Delhi firm with diverisifed interests, on Wednesday said it would approach government-owned BSNL and MTNL to join in doing due diligence of Kuwait's Zain Telecom.
A consortium led by Delhi-based Vavasi group has sent feelers to China Mobile, the world's largest telecom company, for a possible joint bid for Zain Telecom, adding another element of complexity to the battle for the Kuwait-based company that involves India's two state-owned telecom service providers.
State-run BSNL Friday said it may directly talk to Zain Telecom to acquire a controlling stake after the exclusive talks period between the consortium Vavasi and the Kuwaiti firm ends.
The Zain deal raises much speculation about Arifuddin's money and clout. Who is backing him? What is his relationship with politicians? Is he merely a front man for big players in telecom?
Not too much is known about the middle-aged Arifuddin who is Vavasi's major shareholder, except for the fact that he is a civil engineer from Karnataka and started the group around a decade ago.
The race for control of Kuwait-headquartered Zain Telecom has quickened with the Indian consortium led by Delhi-based Vavasi group saying it is willing to give a majority stake in the consortium to state-owned Bharat Sanchar Nigam Ltd or Mahanagar Telephone Nigam Ltd, depending on which company gets government approval to go ahead with the deal.
In one of the largest deals in West Asia, a consortium of Indian telecom firms led by Delhi-based Vavasi Group, which also hopes to rope in state-owned Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL) and a Malaysian investor, will acquire a 46 per cent stake in Kuwaiti telecom company Zain for around $13.7 billion.MTNL and BSNL said they would like to clarify that no view has been taken regarding their participation in the consortium.
Sam Pitroda-backed Vavasi Telegence's request for unused radio frequency to be allotted to launch mobile services across the country is unlikely to be met by the department of telecommunication because it said international technology specifications for this wireless technology do not exist. Instead, DoT is considering the option of allotting the company spectrum in the 400 to 430 MHz band, radio frequencies that are currently not used for mobile services in India.
Asked if BSNL is looking to approach Zain directly, he said "no further progress as far as this proposal on Zain is concerned".
An Indian firm Vavasi Telecom is trying to rope in Bharat Sanchar Nigam Limited and Mahanagar Telephone Nigam Limited to pick up a stake in Zain.
BSNL, MTNL respond to Vavasi despite advice to the contrary
Given the spectrum crunch, it is not clear when the company will get a licence. India is the world's second-fastest growing telecom market and several companies, including Himachal Futuristic, have applied for mobile licences.
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