Vodafone Buys Out Indian Partner

Published on March 31, 2011
by Lilly Vitorovich

Vodafone Group PLC said Thursday it has paid $5 billion to buy out its joint-venture partner in India, in a move aimed at strengthening the U.K. mobile company’s position in a challenging market.

The deal isn’t likely to come as a major surprise to investors because Vodafone had a pact with the partner, Essar Group, that allowed the Indian company to sell its 33 percent stake to Vodafone for $5 billion before a May 8 deadline.

The alternative was that Essar could have sold shares in the venture worth between $1 billion and $5 billion to Vodafone at a market-determined price, to be evaluated by two investment bankers, with one each appointed by the two parties.

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