Distacom, controlled by Sunday Communications co-chairman Richard Siemens, is in talks to sell its interests in two Indian mobile operators to Hutchison Telecom. Mr Siemens, also chairman of unlisted telecommunications investor Distacom, yesterday said the company was in discussions with various mobile operators, including Hutchison. Distacom has appointed investment bank JPMorgan as adviser. The move comes less than two months after Hutchison was reported to be planning to sell its stakes in two Indian joint-venture mobile operators, in what analysts believed would be a restructuring exercise before a possible listing of mobile assets. Distacom had a 42 per cent stake in Spice Communications, which operates mobile networks in Karnataka and Punjab, and a 20 per cent stake in Hutchison Max Telekom, which operates in Mumbai, Mr Siemens said. Spice and Hutchison Max had about 400,000 subscribers each and both recorded net profits, he added. Analysts said Distacom's move was part of a wider restructuring within the Indian mobile sector. Hutchison is the second-largest mobile operator in India, behind Bharti Telecom, which applied for a listing early this year. In October, Hutchison passed the one million subscriber mark in India after a string of acquisitions since 1999. 'Hutchison has a good strategy in India. We don't mind selling part of our [Indian interests] to them,' Mr Siemens said. 'The market is not big enough to support the existing operators. I think only three operators will survive [the consolidation].' A Hutchison Telecom spokesman yesterday said he was unaware of any discussions with Distacom on acquiring its Indian assets. India's Economic Times reported earlier that Hutchison was planning to sell 30 per cent of its 49 per cent stakes in Hutchison Max and Usha Martin Telekom to its Indian partner, Essar Group. Usha Martin operates in Calcutta. An ABN Amro analyst earlier said Hutchison and Essar were in talks on merging their Indian telecoms operations, but differences over valuations had been an obstacle. Turning to Hong Kong, Mr Siemens said industry mergers and acquisitions had been stalled by disagreement on management control and pricing. He said Sunday had made merger and acquisition proposals and counter-proposals with at least two competitors. If no mergers occurred, the weaker players might have little value to potential acquirers, which would take customers from them when third-generation (3G) technologies were deployed in two years, he said. Sunday is one of four 3G licence winners. In any potential merger, Sunday would be the acquirer, rather than the operator being acquired, Mr Siemens said, adding the firm would have to have management control over the merged entity. Mr Siemens was one of the founders of Hutchison Telecom. He sold his shares in 1993.