A report in The Times said a key shareholder, who declined to be named, expressed concern about Hutch Essars fast-rising valuation, warning that Vodafone must not get carried away in a bidding war with Reliance Communications and Essars Ruias.
The shareholder urged Vodafone to stick to the strict acquisition criteria that it unveiled last May in response to shareholder discontent, saying that companies that publish targets would be expected to stick to them or otherwise acquire an unreliable image, the paper said.
Vodafone is yet to seek the opinion of its shareholders on the Hutch Essar deal. But shareholders have said the group should provide firm details on how a bid for Indias fourth largest mobile operator would meet the takeover criteria, The Times said.
Agency reports quoting other British dailies said fears were mounting among some shareholders that Vodafone would be forced to overpay in a much-hyped bidding war. However, no disgruntled shareholders were named in the reports.
POINTS OF VIEW
Hutch Essars valuation is seen in the range of $14-18 billion, with Hutchison Whampoas finance director stating a few days ago that the company would only look at offers upward of $14 billion.
Subsequently, there were unconfirmed reports that the Essar group, which holds 33% stake in the joint venture company, had valued it at $16.5 billion and offered to buy the 67% stake from Hutch and associates for $11 billion.
Unconfirmed reports said Vodafone had placed its bid valuing the company at around $17-18 billion. It had also kept aside $2 billion for expansion plans, post-acquisition.
On Thursday, Reliance Communications chairman Anil Ambani had said that though valuations for the company were mind-boggling, he had the backing of the worlds top 10 private equity firms for his Hutch Essar bid.