Piramal acquires 5.5% in Vodafone
Recently, Ajay Piramal of Piramal Healthcare has purchased 5.5% stake in India’s third largest mobile service provider Vodafone Essar for Rs 2900 crore, or $640 million. Piramal Healthcare struck the deal at a discount valuing British telecom giant Vodafone’s India unit at Rs 52,000 crore ($11.6 billion).
With this, Vodafone has now complied with regulations stipulating 74% limit on foreign direct investment in the domestic telecom sector.
Please note that Vodafone’s stake had crossed 75% after buying out erstwhile partner Essar’s 33% stake in July 2011.
Its worth note that in Feb 2007, when Hutch sold 67% interest to Vodafone, the enterprise value was estimated at $18.8 billion (nearly Rs 83,000 cr at the exchange rate then) Vodafone Essar was valued at $16.5 billion (Rs 73,500 cr) after Essar agreed to sell its 33% interest in the company for around $5.5 billion, including taxes of $460m, last month.
In August 2011, Piramal decides to acquire 5.5% stake for $640 million, which values Vodafone’s Indian operations at $11.6 billion (Rs 52,500 cr)