Videocon Gets Offers for its 49% Stake Sell-Out
Published By : 12 Jan 2015 | Published By : QYRESEARCH
The telecom unit of Videocon Group, Videocon Telecom has got offers from an Indian telecom company and a Mexican company to purchase about 49% stake in Videocon. However, Venugopal Dhoot, Group Chairman stated that the deal would take place only after the telecom frequencies auction is done in the next month. The company will also have further clarity on merger and acquisition rules by next month.
Dhoot further stated that companies are interested in setting up businesses in India will take advantage of this opportunity as the telecom market is rapidly growing in India. Rajkumar Dhoot, the co-promoter stated that Videocon is ready to sell its 49% stake in the mobile operating along with its management controls to the new investor.
Videocon made these announcements after the company got its all India license for selling Internet service much before the auctions wherein the government will offer airwaves to many GSM bands. Presently the mergers and acquisitions rules allow operators to collaborate so long as their collective market share is not more than 50%.
According to analysts, the telecom sector in India will benefit with consolidation just as several other international markets have only four to five carriers. As a part of the oil-to-DTH group, the telecom arm of Videocon has licenses to about seven circles. However, the service provide is only active in Gurjarat, Chhattisgarh, Madhya Pradesh, Punjab, and Haryana. Earlier on, Videocon had bandwidth and licenses in about 22 telecom zones in India, but most of these were dropped after the order by Supreme Court in 2012 that cancelled permits of operators due to ambiguities in earlier allotment process.