 "Vodafone a short-term investment: Piramal")
Mumbai: Piramal Healthcare chairman Ajay Piramal, who picked up an additional 5.5 percent in the country’s second largest mobile operator Vodafone on Saturday, described the move “a short-term investment”, saying that he will cash out when the telco goes public.
“We are merely a short-term investor in Vodafone. We don’t want to be in the telecom sector for the long-term. We have three options to exit. We could exit whenever Vodafone comes out with its initial public offering (IPO), or we could sell our stake to other companies, or we could even sell it to Vodafone itself,” Piramal told reporters in Mumbai today.[caption id=“attachment_205191” align=“alignleft” width=“380” caption=“Piramal Healthcare chairman Ajay Piramal. Reuters”]  [/caption]
“If we use the IPO route to exit, this will depend on the valuation,” he said.
With the latest transaction worth Rs 3,007 crore, Piramal Group has 11 percent stake in the domestic unit of the world’s largest mobile operator by revenue. Also, with this, Vodafone’s original partner, Essar Group, has completely exited the joint venture. The additional stake was picked up from ETHL Communications Holdings of the Essar Group.
Piramal said his company chose to invest in Vodafone for the short-term because of strong growth prospects.
“The telecom story is still positive and the Supreme Court ruling brought more clarity about tax matters. We invested because we had funds available.
“This is a short-term investment on which we expect 17 to 20 percent returns in around 18 months,” Piramal said.
In the wake of positive tax erdict by the Supreme Court and the cancellation of 122 2G licences issued in January 2008 by the Court in another case, which would lead to a much-needed consolidation in the fiercely competitive telecom market, Vodafone going public is only a matter of time.
PTI
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