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Last Updated: Thursday, 28 December 2006, 11:02 GMT
Vodafone in India telecoms battle
Man using mobile phone by poster showing Hindu god with modern technology equipment
India's mobile market is growing fast as consumer spending rises
Vodafone is facing a new rival in its effort to win control of India's fourth-largest mobile phone operator, media reports say.

Last week, the UK group announced its intention to seek a majority stake in Hutchison Essar, as part of its drive to expand in fast-moving markets.

But Indian conglomerate Essar, which has 33% of Hutchison Essar, is now said to have offered to buy the rest.

Hong Kong-based Hutchison Telecom says several firms are after its 67% stake.

Hutchison Telecom also runs networks in countries including Thailand and Israel, but relies on its Indian stake for as much as 80% of its operating income.

The company is part of the Hutchison Whampoa conglomerate, which has reportedly indicated that only offers of more than $14bn will be considered.

Growing market

According to accounts in several British newspapers, Essar has made an approach to Hutchison to buy out the entire business, in a deal valuing the joint venture at about $18bn (9.2bn).

The buy-out would be a severe blow to the ambitions of Vodafone, which is eager to build a more substantial presence in the world's fastest-growing telecoms market.

Vodafone already owns 10% of Bharti Airtel, the market leader in India.

Foreign firms are limited to owning 74% of Indian mobile phone providers.


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