Hutchison values Essar at US$14b
Hutchison Whampoa has set a threshold for potential buyers of its Indian mobile unit, saying that it will only consider bids that value the business at more than US$14 billion.
The news came as the conglomerate's listed telecommunications arm, Hutchison Telecommunications International, said last week that several interested parties such as Britain-based Vodafone Group approached the company about the purchase of its 67 per cent stake in Hutchison Essar, India's fourth-largest mobile firm.
A Hutchison Whampoa spokesman yesterday confirmed a Financial Times report that group financial director Frank Sixt rejected a bid of US$13.5 billion for Hutchison Essar by United States private equity firm Texas Pacific Group and Maxis, a Malaysian mobile operator.
Mr Sixt said the valuation of US$13.5 billion was not exciting, adding that the company would only entertain offers valuing the Indian business at more than US$14 billion, the report said.
Hutchison Essar has attracted at least four other bids.
Egypt-based telecommunications firm Orascom, which owns 19 per cent of Hutchison Telecom, is believed to have linked up with Qatar Telecom.
Vodafone last week expressed its interest in acquiring a controlling stake in Hutchison Essar.
Vodafone said the mobile market in India had great potential and the acquisition was in line with its strategy of exploring growth potential in emerging markets.
Reliance, Indian largest mobile operator, has also expressed interest. It has partnered with US private equity firm Blackstone and secured a US$15 billion loan arrangement with Citigroup and Credit Suisse.
Shares of Hutchison Telecom rose 2.52 per cent to close at HK$18.74 yesterday.