Bahrain Telecommunications (Batelco) announced on Wednesday that it has agreed to sell its entire 42.7% stake in S Tel for $174.5 million, in the first foreign exit since the Supreme Court scrapped 122 2G licences last week.
Batelco will sell the stake to its Indian partner Sky City Foundation and will receive the same price it paid to acquire its holding in S Tel in 2009, the Bahraini operator said in a statement. Batelco had acquired the 42.7% stake in S Tel via two transactions in May and June 2009 for a total of $174.5 million. According to the statement, Batelco had decided as early as April last year to sell its Indian shareholding and had made this clear in its financial accounts. ?This is a part of an earlier understanding with its Indian partner to exit, given the circumstances surrounding the 2G probe in India over the past 12 months,? the company statement said.
The agreed time frame for completion of the sale is the end of October 2012. S Tel officials could not be immediately contacted for comments. ?BMIC, a 100% Batelco-owned subsidiary, entered into an agreement, in the fourth quarter of 2011 to sell its 42.7% equity in S Tel for BD65.8m ($174.5m) to its Indian partner, Sky City Foundation,? the the firm?s CEO Shaikh Mohamed bin Isa Al Khalifa was quoted as saying. ?As Batelco continues to grow and diversify its operations, we remain interested in other investment opportunities for the Batelco Group that will enable us to participate in the Indian telecom market. We are actively exploring all options in this respect over the coming months,? Al Khalifa added.
The now-revoked licences were awarded in 2008, before Batelco bought into S Tel, which had 3.6 million customers as of December and ranks 12th out of 15 players by subscriber base. S Tel has licences for six of the country?s 22 zones, including Assam, the Northeast, Bihar, Orissa, Himachal Pradesh and Jammu & Kashmir.
S Tel had bagged 2G licences in January 2008 in the six circles, cancelled by the SC last week.
Batelco?s move comes close on heels of another global player Telenor, the majority shareholder in Uninor, writing off about $721 million after the Supreme Court?s decision. Telenor claims to have invested over R14,000 crore in India while Russia?s Sistema has pumped in over $2.5 billion (about R12,000 crore).
