India Mobile
Buy Mobiles, Cellphones
 |
 |
 |
 |
|
|
|
|
|
|
|
|
In India’s great telecom sweepstakes game, the trendsetter was C Sivasankaran, the first to milk his equity by selling out to Essar in Sterling Cellular, the mobile licence in Delhi.
Analjit Singh of Max India followed by cashing out from his Mumbai cellular joint venture – Hutchison Max Telecom – for an unprecedented Rs 561 crore in late 1998.
From those days to the recent exit of another Indian mobile industry pioneer Rajeev Chandrasekhar, who monetized his decade-long fight for a cool Rs 1800 crore, the Indian mobile space has seen regular monetization of investment by the pioneers.
Starting from 1994, when the first mobile licences were handed out to first generation entrepreneurs like Sunil Mittal, Rajiv Chandrasekhar, Analjit Singh, Rajiv Mehrotra, Mahendra Nahata, C Sivasankaran Dr Rammohan Rao and Indian Corporate houses like Crompton Greaves, RPG Group, Hinduja. Tata, Modi and Usha Martin, foreign companies like BellSouth, Cable and Wireless, Wireless, Telstra, Vodafone, British Telecom, France Telecom, Distacom, Swisscom and Hutchison also entered the Indian market at that time.
Following Analjit, the next big exit was of Rammohan Rao from JT Mobile (largely a stock deal) and the Crompton Greaves-DSS group combine from Skycell (for around Rs 50 crore). The 1999-2000 timeframe also saw other cash outs with Modi’s (lately of Spice) selling out the Kolkata licence to Airtel for around Rs 450 crore. Usha Martin of the Jhawars was also taken over by Hutch around then for a similar amount RPG also sold its Madhya Pradesh licence around that time.
In 2004, Bharti struck a deal with Shyam Telecom to buy out the latter’s 67.5 percent stake in cellular services company Haxacom for Rs 430 crore. This was followed by Hutch acquiring Nanda’s Escotel’s Punjab Cellular licence and Idea acquiring Escotel’s operations in UP (West), Kerala and Haryana.
As this list (and other deals not reported here) reveals that nearly all of Indian mobility’s pioneering entrepreneurs and companies have exited over the past 15 years.
There is still Idea, and a couple of smaller players – Spice (where Dilip Modi is still holding out) and NRI businessman C. Sivasankaran of Aircel. Their actions will be closely watched.
The Indian mobile space will ultimately see two (or three) large GSM mobile players dominating the Indian market owned by foreign entities from the geographies of Singapore and China. Perhaps companies from other parts of the world will take their place.
But, it seems the Indian telecom industry will exist in three camps – the government owned telecom companies (BSNL and MTNL), the mostly Indian CDMA mobile operators Reliance and Tata and private GSM operator owned by a Chinese real estate shark and tiny Singapore’s powerful investment agency Temasek.
Meanwhile, of the original pioneers, Sunil Mittal remains invested having built a Rs 48,000 crore business (by market cap). His personal worth today would be in the vicinity of Rs 16,000 crore.
In fact, private equity firm Warburg Pincus which has exited in tranches from Bharti has already made a mind-boggling sum of $1.8 billion.
