Idea Cellular to buy 40 percent stake in Spice TelecomJune 25th, 2008 - 2:35 pm ICT by IANS
Mumbai, June 25 (IANS) India’s fifth largest cellular operator Idea Cellular Wednesday formally announced it would pick up 40.8 percent stake in Spice Communications Ltd at Rs.77.30 per share. The company also said that it would merge with Spice through a share-swap arrangement, under which Spice shareholders would get 49 Idea shares for every 100 Spice shares.
In addition, Idea and Telekom Malaysia will together make an open offer for acquiring an additional 20 percent stake in Spice at Rs.77.30 per share. Telekom Malaysia holds 39.2 percent stake in Spice.
As a part of the merger, Idea will sell a 14.99 percent stake to Telekom Malaysia on a preferential basis at Rs.156.96 per share. Idea will also pay Rs.5.44 billion to Spice promoters as a non-compete fee.
The talks between Idea, Telekom Malaysia and Spice have been going on for over a month. Spice operates in Punjab and Karnataka, two circles where Idea doesn’t have any presence.
Spice has more than four million subscribers.
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