Tata Comm, Tata Tele rally up to 6% as group plans to exit telecom biz Shares of Tata Communication and Tata TeleservicesBSE 2.49 % (Maharashtra) rallied 3-6 per cent in trade on Wednesday, after ET Now reported that the chairman of the group, Cyrus Mistry, has decided to exit the telecom business completely. Sources with direct knowledge told ET Now that the Tata Group has initiated talks with Vodafone to sell both Tata CommunicationsBSE 2.26 % and Tata Tele. Deal talks are at a preliminary stage sources point out. Tata Communication rallied as much as 3.9 per cent while Tata Teleservices rose 5.6 per cent in trade. At 02:40 p.m.; Tata Communication was trading 3.1 per cent higher at Rs 283.40. It has hit a low of Rs 276.90 and a high of Rs 285.75 in trade today. Tata Teleservices (Maharashtra) was trading 2.7 per cent higher at Rs 7.42. It has hit a low of Rs 7.23 and a high of Rs 7.63 in trade today. It will be a deal in several stages as both Tata Tele and Tata Comm have large shareholders with dominance on board decisions, said the ET Now report. Japanese firm NTT Docomo holds 26 per cent in Tata Tele and has a put option which expires on March 31, 2014. Sources suggest that Docomo may give a one-year extension to their put option to pave the way for a deal with Vodafone. ET had reported on Tata Tele-Vodafone deal talks on January 3, 2014. Government of India holds 26 per cent in Tata Communications and as part of the deal negotiations with Vodafone, Tata Group will first buy out governments stake in the company and then sell to the UK-based telecom giant. In response to an e-mail query sent by ET Now on the specific query to Tata Sons, Tata Sons is looking at exiting telecom business completely, talks are at a preliminary stage Tata Sons spokesperson said.
Posted on: Wed, 29 Jan 2014 10:35:16 +0000