Stocks of Piramal Healthcare surged over 8 per cent in early trade after the company said it will acquire a further 5.5 per cent stake in Vodafone India from ETHL Communications Holdings (Essar) for Rs 3,007 crore.
The transaction follows the settlement between Vodafone and Essar over the sale of Essar's around 33 per cent stake in Vodafone India, announced in July 2011, Piramal Healthcare said in a regulatory filing on Saturday.
At 1025 hours, Piramal Healthcare traded with nearly 2 per cent gains on the Bombay Stock Exchange. Other group firms, Piramal Glass (2.5 per cent) and Piramal Life Sciences (5 per cent) also saw buying interest. The Sensex traded 1 per cent higher at 17,774.
"This is not a strategic investment. We have no plans to enter the telecom sector. We hope to exit in next 12-18 months either through an IPO or a stake sale," Ajay Piramal, Chairman of Piramal Group, said today.
"The idea is to utilise this money in the short term...to generate higher returns that can be earned...rather than be invested in fixed deposit," he added.
Last year, Vodafone had bought out Indian partner Essar's 33 per cent stake in the joint venture for $5.4 billion. That transaction took Vodafone's ownership to 75.35 per cent, more than the prescribed Foreign Direct Investment (FDI) limit of 74 per cent.
Piramal Healthcare picked up a strategic 5.5 per cent in Vodafone for $640 million in August 2011, helping Vodafone meet regulatory requirements.
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