Telekom Malaysia itching for more Spice

Telekom Malaysia might partner with strategic investors to increase their combined stake in Spice Communications to 74 per cent.The Malaysian giant has 39.20 per cent equity in the telecom company and foreign institutional investors hold 9.59 per cent, taking the total foreign holding to 48.79 per cent.The potential partners include United Arab Emirates’s largest telecom company, Emirates Telecommunications Corp (also known as Etisalat).

Spice, the regional wireless service provider, operates in the Punjab and Karnataka telecom circles and has a 2.2 per cent market share in the country’s total GSM space. Recently, it received licences to operate in four more circles -- Andhra Pradesh, Delhi, Haryana and Maharashtra -- but is awaiting additional spectrum.

Read more in The Business Standard article.

Spice Communications raises $128 mn from public issue

Spice Communications Ltd, an Indian mobile phone venture partly owned by Telekom Malaysia Bhd., raised Rs520 crore ($128 million) in an initial public offering as investors try to tap a market whose numbers almost doubled in 2006.

The Noida-based company priced the 113.1 million new shares at Rs46 apiece, the top end of a Rs41-46 range, according to an email sent to investors. The stock will trade on the Bombay Stock Exchange.

The mobile operator and larger Indian rivals, led by Bharti Airtel Ltd and Reliance Communications Ltd, are attracting investors trying to get access to the world’s fastest-growing market last year. Spice, which offers its services in the southern state of Karnataka and Punjab in the north, plans to spend $140 million during the next two years to boost coverage.

Last month, Spice sold stakes worth $10.1 million each to Lehman Brothers Holdings Inc. and Spinnaker, the company said.Enam Financial Consultants Pvt. Ltd and UBS AG arranged the Spice share sale.

Read more in The Livemint article.

Spice fixes IPO price band at Rs 41-46

Cellular operator Spice Communications Ltd said on 19 June it has fixed the price band of its proposed public issue between Rs41 and Rs46 an equity share of Rs10 each.
“We have recently concluded a pre-IPO placement of 24,837,889 shares at Rs45 per share, thereby raising about Rs112 crore. A clutch of investors led by Lehman Brothers and Sinnaker Investments have picked up a small stake in Spice Telecom,” company chairman and managing director Dilip Modi told reporters at a press conference.

Following the IPO, the stakes of the both the promoters, B K Modi and Telekom Malaysia, would come down by 10% each.At present, B K Modi holds 51% and Telekom Malaysia, the remaining 49%.Post-IPO, Modi will hold 41% while Telekom Malaysia, 39%, with the public holding the remaining 20%.

Read more in The Livemint article.

Spicy deal: Spice, Idea now talk merger

A major consolidation in the telecom sector could be on the cards. Discussions have just begun between Spice Telecom and Idea Cellular for a possible merger, whose outcome can go either way.

According to top sources, the option of both Spice buying out Idea Cellular as well as the Birlas-owned Idea Cellular buying out Spice are being considered. However, with talks being in the preliminary stages, a source said it would take anywhere between 8 and 12 months before anything could be finalised.

Adding a new dimension, sources told ET that Telekom Malaysia, which holds 49% in Spice Telecom (the BK Modi group holds 51%) is keen to expand its footprint in India and make some acquisitions to expand Spice’s operations. This is because Spice, at present, is limited to just two telecom circles, Punjab and Karnataka.

Last year, Telekom Malaysia had acquired 49% in Spice for $179 million (Rs 733 crore). In June 2005, Telekom Malaysia and Singapore Technologies Telemedia had opted out of the agreement for acquiring a 47.7% stake in Idea Cellular for about $390 million as the government did not clear the deal.

Read more in The Economic Times article.