Israel's Koor eyes stake in Tata Tele

Israeli company Koor Industries has expressed interest in acquiring a minority holding in CDMA service provider Tata Teleservices (TTSL). TTSL, however, refused to comment on this "speculation".

The company has sent a non-binding letter of intent (LoI) expressing its interest to invest $577 million (about Rs 2,300 crore) in TTSL. There was "no certainty" a deal would be reached, Koor said in a filing with the Tel Aviv Stock Exchange (TASE).

According to reports, TTSL was planning to raise over $1 billion (Rs 4,000 crore) by selling around 30 per cent stake to private equity firms or other investors. The company has also appointed Lazard Capital for stake sale and believed to be in talks with potential buyers, including Israel-based Bezeq.

Koor Industries is a holding company with interests in agrochemicals, defence electronics, venture capital and telecommunication. It has a 61 per cent holding in Telrad Networks (a global telecom equipment and services organisation) and 21 per cent holding in ECtel (a solutions provider).

IDB Group, which owns Cellcom, had acquired 55 per cent of Tel Aviv-based Koor two years ago. The Singapore government's investment arm, Temasek Holdings, has a 9.9 per cent stake in TTSL, while Chennai-based tycoon C Sivasankaran holds 8 per cent stake.TTSL offers CDMA-based services across 20 circles in the country and has a subscriber base of over 25 million.

The Department of Telecommunication (DoT) has allocated CDMA spectrum to the company for Assam, North East and Jammu & Kashmir, and GSM spectrum in Tamil Nadu.