India partly approves Vodafone stake hike in local unit
The Indian government Monday partly approved Vodafone Group PLC's application to raise its stake in its local venture as part of a deal in which the British telecommunications major agreed to buy out its local Indian partner.
Since the transaction is between non-resident companies, there is no foreign equity inflow, India's Ministry of Finance said in a press release, referring to one of the applications.
However, the government deferred ruling on another application by Vodafone Essar Ltd. to transfer shares from a resident entity to a non-resident firm, the press release said, without elaborating.
Earlier this year, Vodafone agreed to buy out local partner Essar Group's 33% stake in Vodafone Essar for about $5.46 billion. The Essar Group had held a 22% stake through Mauritius-based Essar Telecom India Ltd. and a further 11% through Indian-registered Essar Telecommunications Holdings Pvt. Ltd.Vodafone had asked for approval to the transactions related to the transfer of shares in the Indian venture Vodafone Essar Ltd. from Mauritius-based Essar Communications Ltd., and Essar Com Ltd. to Euro Pacific Securities Ltd., an indirect subsidiary of Vodafone International Holdings B.V., the press release said.
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