After taking a battering in its share price, India’s second larget real estate players, Unitech has sold off 60% stake via fresh share issue in Unitech Wireless to Norwegian company, Telenor for Rs.6120 crore valuing the company at Rs.10200 crore.
The development has come at a much needed time for Unitech as it badly needs liquidity for real estate business and especially with all the bad news pouring in.
Telenor already is the second largest non-Asian telecom operator after Vodafone and has operations in Pakistan and Bangladesh.
Unitech Wireless makes a good fit for Telenor as the former has a pan-India telecom licence and slated to begin service in early 2009.
Regarding valuations, the valuation may be on a higher as Idea Cellular which is among the first entrants in the Indian telecom market has a valuation of close to Rs. 12000 crores. Even the recent Swan Telecom-Etisalat deal valued Swan at over Rs.10000 crore.
But given the expectations for Indian telecom market, it may turn out to be a good bargain for Telenor.
Find this article at: http://www.labnol.org/india/corporate/unitech-sells-stake-in-telecom-arm-reasonable-valuations-in-competitive-market/5122/
web: http://www.labnol.org/ email: amit@labnol.org
Reader Comments
Now I thing govt should not approve this deal because it will be a heavy loss on part of govt and is in public interest.
Written by Management Guru on 11.06.08