India opens telecoms door to Vodafone

Britain's Vodafone is being challenged by India's Reliance Communications, the Hinduja group and Hutchison's minority partner in the venture, Indian group Essar, in the race for Hutchison Essar.

Valuation estimates for Hutchison Essar, where a 67 per cent controlling stake owned by Hong Kong conglomerate Hutchison Whampoa is on offer, have climbed to as much as $US20 billion ($A25.85 billion) from around $US13.5 billion (SA17.45 billion) as the list of suitors expands.

Winning control of Hutchison Essar would give Vodafone a strong asset and 22 million customers in a fast growing market.

India's main mobile operators now share nearly 150 million customers, but with India's population over 1.1 billion, it translates to less than two out of 100 people owning a mobile.

For Vodafone, which faces slowing growth in its key Western European markets, a strong presence in India could provide it with a vital growth engine.

Vodafone owns a 10 per cent stake in India's top mobile company Bharti Airtel, but does not stand a chance of getting control as Bharti's main shareholders don't want to sell.

[Courtesy - www.theage.com.au ]

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IMERT, Pune