Axiata considering options to increase Idea Cellular stake

28 May 2009

According to the Business Standard, Malaysian telecoms group Axiata is considering increasing its stake in mobile operator Idea Cellular. Currently Axiata holds a 14.99% stake in the cellco, but it is understood that it may seek to increase this to 40% by making an open offer. The move comes as the Malaysian company looks to attain parity with Idea’s other major shareholder, the Aditya Birla group, which holds a 49% stake; at minimum Axiata is expected to increase its stake to 26%, a level that under Indian company law would give it the power to veto decisions affecting the cellco. Axiata will increase its stake in Idea as part of the soon-to-be-completed merger of Spice Communications and Idea; after the merger completion Axiata will hold 20% of Idea, while the Aditya Birla group’s stake will fall to 45%. Idea shareholders are expect to vote on the proposals in July.