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Emirates Telecommunications(Etisalat) has acquired a majority stake in its Indian subsidiary Etisalat DB Telecom by acquiring a 5.27% stake from Chennai based Genex Exim Ventures Pvt Ltd for $81.3 Mn, valuing the company at $1.5 Bn. The company has approached FIPB for approval of the deal.
This deal takes up Etisalat's holding in Etisalat DB Telecom to 50%. Earlier in 2008, Etisalat acquired 45% in Etisalat DB (earlier Swan Telecom) for about $900 Mn through its Mauritius-based investment arm Etisalat Mauritius.
Etisalat had valued the telco at $2 Bn in 2008. The drop in valuation might be a reflection of the tariff war and the intensifying competition among the telcos.
Other shareholders in Etilsalat include DBG Group with 45.73% stake and Delphi Investments with a 4.27% stake. DBG Group holds the stake through Tiger Trustees Pvt Ltd. Etisalat DB Telecom has UASL Licences in 13 circles including Mumbai and Delhi. Recently, it also acquired the licence for national, international long-distance and internet services. Etisalat DB has initially owned by Reliance Telecom and Tiger Trustees Pvt Ltd. Reliance Telecom then sold its holding to Dynamix Balwas Infrastructure Pvt Ltd and Delphi Investments Pvt Ltd. Etisalat, headquartered in UAE is one of the largest telcos in the world with operations in our 16 countries across Asia, the Middle East and Africa. As per the Indian norms, an FDI of 74% is allowed in Indian Telcos, however there is a lock-in period of three years on the equity stake held by promoters of new telecom companies.
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