While Essar has offered $11 billion for the 67 per cent stake of HTIL, Vodafone has submitted an offer valuing the company at $17-18 billion.
Updated at 2.45pm
LONDON: Triggering a bid war for Indian mobile operator Hutch-Essar, being valued up to 18 billion dollars, UK-based Vodafone and India's Essar have made their offers to acquire Hutchison Telecom's stake in the venture.
A day after the visit of top brasses of both Vodafone and Essar, British media reported, quoting unnamed sources, that the two suitors have made their respective offers.
Essar, the joint venture partner in Hutch-Essar with 33 per cent stake, has offered 11 billion dollars (about Rs 50,000 crore) for the 67 per cent stake of HTIL, putting the enterprise value of the JV at 16.5 billion dollars.
However, Vodafone, the world's largest mobile phone operator, has submitted an offer valuing the company at 17-18 billion dollars, the 'Financial Times' reported.
No comments could be ascertained from Vodafone, Essar and Hong Kong-based Hutchison Telecom International Ltd.
There was confusion in Indian media on valuation of Hutch-Essar following an interview by HTIL's parent Hutchison Whampoa's finance director Frank Sixt that the group would not entertain any offer made below 14 billion dollars.
This was construed by many as the valuation of HTIL's 67 per cent stake, thus pegging the enterprise value of the joint venture at 21 billion dollars.
According to the report in the FT's online edition: "Vodafone on Wednesday faced a new rival in its drive to win control of Hutchison-Essar after a minority shareholder (Essar) turned the battle for control of the Indian mobile operator into a three-way fight."
Vodafone also submitted an offer to HTIL for Hutchison Essar, valuing the company at 17-18 billion dollars, the FT report said. The British company could set aside another two billion dollars as part of extra costs associated with the deal, it added.
Meanwhile, a report in 'The Times' said the two brothers Shashi Ruia and Ravi Ruia, chairman and vice-chairman of Essar respectively, differ on whether to sell their 33 per cent stake in Hutch-Essar or stay invested.
Incidentally, Ravi Ruia was in Hong Kong earlier this week, presumably to hold talks with HTIL on the issue. Vodafone CEO Arun Sarin was also in Hong Kong recently in connection with the UK-based company's bid.
Another British daily 'The Telegraph' reported that Essar is believed to have received a line of credit for 10 billion dollars from Morgan Stanley and Citibank to fund the bid.
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