The Vodafone
Group may soon dispose its indirect 4.4 per cent stake in Indian rival Bharti
Airtel, worth an estimated $1 billion, about N159,311,773,140.04 in order to
comply with new rules about cross ownership among mobile operators, reports MobileWorldLive.com
The Report has it that the new rules say no carrier can hold
a direct or indirect stake in a rival operating in the same service area. The
rules apply across the country’s 22 licensing ‘circles.’
DigitalSENSE
Business News notes that Bharti and Vodafone are the India’s number one and
two operators respectively. Just as the new rules on cross shareholding was proclaimed
last Friday.
Current rules allow cross ownership of up to 9.9 per cent,
but operators must move across to the new rules when their existing licenses
expire, even as they would have one year to sell off any stakes held in rivals.
As reported by Economic Times, Vodafone’s licenses in Delhi,
Mumbai and Kolkata are expected to expire towards the last quarter of 2014, whereas
the operator’s license for Madhya Pradesh is due in 2027.
DigitalSENSE
Business News calls to mind that the Indian government proposed the idea of
eliminating cross shareholdings among mobile operators to eliminate the
possibility of cartel-like behaviour. It is concerned about operators acting in
this way, for instance during a spectrum auction.
The fears seem imperative after the inability of an auction last
November.
Remmy Nweke with agency reports
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