Sequoia takes 1.5 % Idea stake for $48 mn
Thursday, 07 December 2006, 18:30 IST
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Bangalore: Sequoia Capital has picked up a stake of 1.5 percent in Idea Cellular for around $48 million. According to the industry estimates, U.S-based Providence Equity Partner has bought 15 percent of equity of Idea cellular for $400 million and 5-8 percent of equity has been bought by UK-based hedge fund group- GLG Partners for $210 million, according to a leading business daily. Compared to the above Provident Equity players, Sequoia Capital is said to have bought at a higher price. The Aditya Birla group had offloaded nearly a 10 percent stake to investors such as Providence Equity Partners of the US, India's ChrysCapital, the UK’s TA Associates and Citigroup. Citigroup Global and UBS Securities has been appointed as senior co-book running lead managers and JM Morgan Stanley and DSP Merrill Lynch as the lead managers by the Company. In the wake of receiving a nod from the Department of Telecommunications (DoT) to expand the cellular services in six more areas, GSM mobile services operator, Idea Cellular announced a strategic alliance with Insurance Company, Aditya Birla Group. The alliance had been initiated through ‘group term insurance cover’, an offer to the customers where both pre and post-paid subscribers between 18 and 35 years of age get a free life insurance policy at the click of a button. The duo was all set to enter the most lucrative circle, Mumbai and Bihar. Later, the companies approached market regulator SEBI for clearance of an initial public offer, to meet up an estimated cost of Rs 2,500 crore. The company had filed a red herring prospectus with the Securities and Exchange Board of India (SEBI) and Idea officials explained that the company would be all set to hit the capital market soon after it gets a clearance from the market regulator. The Company has explained that the funds raised from IPO would be used to expand the services in new circles, launch services in Mumbai Telecom circle, and launch long distance operations and redemption of preference shares.
Source: IANS
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