Unlikely Bride ; Discord Between the Two Primary Shareholders of Hutchison Essar Puts the Hindujas, a 5.11 Per Cent Shareholder in the Jv, in a Vantage Position.
Linked as:
Summary
Rarely has a 5.11 per cent holding been of such import and caused so much heartburn. Then again, Hutchison Essar isn't any common company. It's a full-blooded telecom play used by 16.6 million subscribers in 16 circles nationwide, and has one of the highest EBITDA margins in the industry (just over 47 per cent). It's got the Hong Kong-headquartered Hutchison Telecom International Ltd (HTIL) as one partner, with a 61.84 per cent stake (directly and indirectly), and the Ruias of the Essar group as a secondary partner with a 33.05 per cent holding. Over recent months HTIL has been keen to take advantage of peaking valuations by taking the joint venture public on the Indian markets, but Essar, it appears, isn't exactly in a hurry to do so.
Against this backdrop, the 5 .11 per cent stake in question, owned by the Hinduja group, assumes significance. The Hindujas are open to selling their stake-at a price but naturally-and both HTIL and Essar are eager to get hold of it. For Hutch it would mean a step closer to the maximum permissible foreign investment limit of 74 per cent. The Ruias would prefer that doesn't happen, and one way of ensuring that is to beat HTIL in the race for the 5.11 per cent. In such a scenario, the party holding all the cards is the Hinduja group, what with both major partners apparently falling over each other to purchase its stake.See the full content of this document
Extract
Unlikely Bride ; Discord Between the Two Primary Shareholders of Hutchison Essar Puts the Hindujas, a 5.11 Per Cent Shareholder in the Jv, in a Vantage Position.
Just as investment bankers were reconciling themselves to the Hindujas selling to th...
See the full content of this document
Sponsored links
