Tata Teleservices, the Indian phone partner of Japan?s NTT DoCoMo, is preparing to sell about Rs 3,000 crore ($671 million) in stock to fund network expansion, two people familiar with the matter said.
The share sale will probably be disclosed by March 31, said officials, who asked not to be identified because the information isn?t public.
NTT DoCoMo, based in Tokyo, plans to buy enough shares to maintain its 26%stake in the closely held Indian company, they said.
The proceeds will help Tata Teleservices build its third- generation wireless network in the world?s second-largest market for mobile services.
The company was among nine Indian operators including Vodafone Group?s Indian unit that spent R67,720 crore on next-generation wireless permits in a government auction last year.
Rajeev Narayan, a spokesman for Tata Teleservices in New Delhi, didn?t respond to a call on his mobile phone. Takuya Ori, a DoCoMo spokesman, declined to comment.
Tata Teleservices Maharashtra (TTLS), the listed unit that provides mobile-phone services in Mumbai, the western state of Maharashtra and Goa, rose as much as 2.6% to R15.65 before trading at R15.40 at 12.44 pm on the city?s stock exchange.
Tata Teleservices won licences in nine of India?s 22 telecommunications zones, paying R900 crore.
NTT rose 1.2% to close at 147,900 yen in Tokyo trading. The stock has gained 6% over the past year.
Tata Teleservices plans to split the offering into two equal tranches of R1,500 crore each, one of the people said.
NTT DoCoMo, Japan?s largest mobile-phone operator, completed a 250 billion yen ($2.6 billion) investment in Tata Teleservices in March 2009.
Temasek Holdings, Singapore?s state-owned investment company, bought 9.9% of the Tata Group unit in March 2006. Tata units generated combined revenue about $70 billion last year, according to its website.