India Digest: Tata Tele shutdown; Bharati Defence sale; Asahi India stake sale

While Tata Group is considering winding down its telecom business, German Dry Docks Group is looking at a possible acquisition of Bharati Defence. Also, Japan’s Asahi Glass is planning to buy out Indian joint venture partner.

Tata Group mulls winding down mobile services biz

After failing to attract buyers, Tata Group chairman N Chandrasekaran is considering the option of winding down the mobile services business, Tata Teleservices, according to a Times of India report quoting sources.

If the move goes through, then Tata Group may have face financial hurdles, as beleaguered Tata Tele has a consolidated debt of over Rs 34,000 crore, however with the sale of telecom spectrum it could lessen the blow.

According to the news report, the lenders to Tata Tele may also have to take a haircut, perhaps the first time where they may have to take a knock on their exposure to a Tata entity.

Tata Tele has around 45 million subscribers with about 4 per cent share of the Indian mobile telephony market.

Tata Tele  had reportedly earlier explored sale talks with Bharti Airtel and Reliance Jio. The telecom services provider has been searching for a new home after Japanese partner DoCoMo, which owns 26 per cent, decided to pull out three years ago.

German Dry Docks looks to acquire Bharati Defence

German Dry Docks Group is looking at a possible acquisition of debt-laden Bharati Defence and Infrastructure (formerly Bharti Shipyard), according to a report in The Economic Times.

According to the sources in the report, German Dry Docks has approached the lenders of Bharati Defence, putting an enterprise value of around $370 million to the company.

“A proposal has come to the lenders from the German company along with a Hong Kong-based private equity fund to acquire the company. The initial interest pegs the company’s enterprise value at around Rs 2,400-2,500 crore,” said one of the sources quoted in the report.

Bharati has also seen interest from suitors looking at picking up individual docks in the east and the west.

Japan’s Asahi Glass plans to buy out India JV partner

Japan’s Asahi Glass, is planning to buy out joint venture partner Sanjay Labroo and take control of Asahi India Glass, as per  a report in The Economic Times quoting sources.

Asahi Glass and Labroo and his family own an equal around 22 per cent stake in the local auto glass manufacturing venture. According to the news report, Maruti Suzuki which owns a little over 11 per cent, will continue to hold its stake.

“After a protracted negotiation of over nine months, Asahi is likely to pay about Rs 2,500 crore to buy out Labroo and his family members, valuing the company at about Rs 12,500 crore,” said one of the source quoted in the report.

“The deal is expected to close at between Rs 475 and Rs 525 per share. This is at a significant premium to the price of Rs 180 a share late last year when the discussions had started,” he added.

Under the proposed deal, Asahi Glass would make an open offer for another 26 per cent that, if fully subscribed, would cost another Rs 3,000 crore.

Asahi India however denied the news report.

Also Read:

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