The Department of Telecommunications (DoT) is planning to raise about ₹7,000 crore by selling a 30% stake of state-owned Telecommunications Consultants India Limited (TCIL) in Bharti Hexacom, said people aware of the matter.
Bharti Hexacom, as part of the arrangement, would opt for a public listing of its stocks and issue an IPO upon regulatory approvals, said one of the persons who did not wish to be identified.
Bharti Hexacom, an unlisted company that offers mobile services in Rajasthan and northeast circles, is a JV between
, which owns 70%, and state-run TCIL, which holds a 30% share.
The DoT is in the final stages of issuing a direction to TCIL which, according to the person, will first negotiate with Bharti Airtel, which has a right to first refusal as per the terms and conditions of the agreement between the two.
SBI Caps has been engaged for valuation and completion of transactions by TCIL.
Initially, TCIL was planning disinvestment of equity stake in Bharti Hexacom, but the Department of Investment and Public Asset Management (DIPAM) indicated the DoT was not mandated to initiate disinvestment of a public sector unit in some other private firm.
The disinvestment has been hanging fire for over a decade.
In 2011, the state-controlled company’s plans to exit Bharti Hexacom had come a cropper when the then cabinet secretary KM Chandrasekhar dismissed the₹1,800-crore reserve price fixed by Deloitte for its 30% stake as “too low”.
In 2006, TCIL had declined the ₹262.5 crore offered by Bharti Airtel in lieu of its 30% stake.
TCIL, through the Hexacom stake sale, is eying cash flows to ease its balance sheet.
It has annual revenues of about ₹1,750 crore and is expecting to double its revenues by 2025.