Bell South To Sell Off Skycell Stake

Bell South International of the US has decided to exit India by selling off its entire 24.5 per cent stake in SkyCell, the cellular service operator in Chennai.

For this, Bell South has initiated discussions with the domestic telecom major, Bharti Telecom.

Bell South will be the third global telecom player to exit from India after SwissCom exited from Essar-Sterling joint venture, AirTel in Delhi, and Bell Canada from Tata Cellular and basic services in Andhra Pradesh.

Bharti at present holds a 40.5 per cent controlling stake in SkyCell, which it acquired from Crompton Greaves last year at around Rs 120 crore. Industry sources said the entire cellular service of SkyCell is valued at $120 million, or Rs 490 crore.

 

The acquisition will increase Bharti's stake to 65 per cent. Of the other stakeholders in SkyCell, Millicom International Cellular S A holds 24.5 per cent, while 10 per cent of the remaining equity is with the DSS Enterprises, promoted by the former Pure Drinks promoter, Satwant Singh.

Bharti group chairman Sunil Mittal confirmed to Business Standard that his company

has initiated discussions with

Bell South. He said: "We always wanted to increase our stake in any telecom joint venture, provided our partners are willing to sell it."

SkyCell has a subscriber base of over 20,000 and its licence area covers 2,250 sq km in Chennai and its suburbs. Bharti is present in Delhi, Chennai, Himachal Pradesh, Andhra Pradesh, Karnataka and Madhya Pradesh, where it operates basic services.

The company reported a loss of Rs 42 crore on a turnover of Rs 34 crore in 1998-99.

Industry sources said the Bharti group had expressed interest in acquiring the entire equity from its partners in the venture. However, negotiations have started only with Bell South.

The Bharti group is the largest domestic cellular with four circles providing cellular services and is also the basic service provider in Madhya Pradesh.

It has been on an acquisition spree last year by acquiring

JT Mobile.