Japanese telco NTT Docomo has announced it will increase its investment in cellco Tata Teleservices (TTSL) after the Indian company said it was considering a rights offering.
A few days ago, it was reported that TTSL was seeking to raise about US$670m…
Japanese telco NTT Docomo has announced it will increase its investment in cellco Tata Teleservices (TTSL) after the Indian company said it was considering a rights offering.
A few days ago, it was reported that TTSL was seeking to raise about US$670m in a rights issue in order to fund its 3G network expansion. Docomo, which owns a 26% stake in the Indian cellco, said in a statement today that it will participate in the rights issue by investing about Rs8bn (US$179m) in the company.
“Payment of one portion of the funds has been made so far, and the rest of the investment is scheduled to be completed in May,” Docomo explained in the statement.
This investment comes as British telco Vodafone announced today it would buy out Essar’s stake in their joint venture Vodafone Essar for US$5bn. Despite regulatory uncertainties and the potential threat of losing licences amid the 2G scam, both Docomo and Vodafone have chosen to further investment in the Indian market. But a new telecom policy is currently being drafted, which is expected to clarify certain rules and encourage M&A.
In the statement, Docomo said: “The additional investment is part of Docomo’s ongoing strategy to expand its business presence and revenue sources in India’s rapidly growing mobile market.”
