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Vodafone makes offer for acquisition of Hutchison Essar

Vodafone, the world's largest mobile phone operator, has submitted an offer for Hutchison Essar of India valuing the company at US$17 billion to US$18 billion, a report said yesterday.

The bid has been submitted to majority shareholder Hutchison Telecom, owned by Hong Kong conglomerate Hutchison Whampoa, the Financial Times reported, citing unnamed sources close to the talks.

The report said that another US$2 billion could be added as part of extra costs associated with the deal as Vodafone seeks expansion in the world's fastest-growing mobile market.

However, the talks could be derailed by India's Essar, which owns a 33 percent share in the group, after it offered US$11 billion for the remaining stake.

Apart from Vodafone and Essar, the newspaper said Reliance Communications, India's second-largest wireless operator, was also in the race for Hutchison Essar, the country's third-largest with 27 million subscribers.

The Times of India said the Essar Group has offered to sell its stake in Hutchison if Vodafone wins control of the company.

The Essar Group would sell its 33 percent stake through a public offer a year after a Vodafone takeover for at least the price paid by the British company.
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