US-based private equity (PE) player Providence Equity Partners is considering an exit from Idea Cellular, the flagship telecom company owned by the Aditya Birla Group.
Providence had bought 15 per cent in Idea Cellular in 2006 for around Rs 1,800 crore (Rs 18 billion) through its investment arm - P5 Asia Investment (Mauritius).
It diluted the remaining 5.01 per cent over the next 5 years. If Providence implements its plan, it will be one of the largest open market exits by any PE fund in India.
According to sources familiar with the development, the Providence management thinks its investment has yielded a decent return and there is no point holding on to the stake as the future looks uncertain in the backdrop of the 2G scam, which has rocked the telecom industry in India.
Sources in Idea Cellular said the tussle between the company and the Department of Telecommunications (DoT) could be the immediate trigger for Providence's plan.
Providence Equity Partners' spokesman, Andrew Cole, did not respond to a detailed email. An Aditya Birla Group spokesperson said the company did not want to comment on market speculation.
Apart from Providence, the other major stakeholders in Idea are TMI Mauritius Ltd (14.07 per cent) and TMI India (5.01 per cent).
The promoters of Idea Cellular hold 46.04 per cent through various entities--Aditya Birla Nuvo (25 per cent),
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