Tiw To Offload Stake In Hexacom

Telesystems International Wireless (TIW), the Canadian telecommunications major, has decided to offload its 40 per cent stake in Hexacom India, the Rajasthan cellular circle operator and also the licensee for the north-eastern circles.

Hexacom, which offers mobile services under the brandname Oasis Cellular, is a three-way venture among Shyam Telecom (which holds a 40 per cent stake), the state-run Telecommunications Consultants of India (20 per cent) and TIW (40 per cent).

The Shyam Telecom group, which is undergoing a recast, has appointed Prime Securities to value the circle and also to find a strategic investor to replace TIW.

Shyam Telecom is also evaluating the possibility of enhancing its stake in Hexacom by picking up the equity of TIW.

which has wireless operations in Asia, Europe and Latin America, and later induct a strategic partner, said the sources. However, Shyam Telecom is expected to retain a controlling stake in Hexacom.

A clutch of foreign cellular firms have pulled out of India owing to the global consolidation taking place in the mobile telephony business.

Companies which have already exited India include Australian major Telstra, Shinawatra of Thailand, Bezeq of Israel, Swisscom and Bell Canada.

According to a telecommunications analyst at ABN Amro, since the government is in the process of inviting a fourth cellular player in each circle, the valuation for the existing circles may no longer be attractive to overseas participants.

Hexacom India, which started operations in 1996, claims a cellular user base of over 35,000 in Rajasthan.

Interestingly, it is the only operator in the state to pay an undisclosed licence fee to offer uninterrupted cellular services.

Hexacom, which is planning to achieve a revenue of Rs 64 crore in 2001, gets one of the highest minutes of usage in Indian mobile circles.

It is facing competition from the Essar group, which currently offers services in 10 cities and plans to unveil operations in another six cities in the next six months.

The equity and net worth of Hexacom as on March 31, 2000, stand at Rs 180 crore and Rs 109 crore, respectively. The company, which may enhance the capital base, has a debt exposure of Rs 36 crore, while its revenue was Rs 35 crore.