Vodafone said to clear IPO for Indian unit

Dylan Bushell-Embling
13 Dec 2011
Daily News

Vodafone has reportedly given its Indian unit permission to proceed to an IPO on the local exchange.

A source told the Wall Street Journal that preparations for a public listing of India's second largest mobile operator are now underway.

But Vodafone India's official stance is that there are no firm plans for an IPO yet, and the company has yet to file the required papers with the Securities and Exchange Board of India.

Vodafone first suggested the possibility of an IPO of the unit in April, after buying out former JV partner Essar's stake in the company for $5 billion.

The company had initially indicated it may pursue an IPO to remain in compliance with Indian laws restricting foreign direct ownership in an operator to no more than 74%, but instead chose to sell a 5.5% stake in the venture to an Indian medical services provider.

Vodafone's future plans for India may be influenced by the verdict in its long-running tax battle with the Indian government, which India's Supreme Court is expected to rule on this month.

A lower court found in the government's favor last year, rejecting Vodafone's appeal against the $2.6 billion tax bill it accrued from the purchase of its stake in the Indian venture from Hutchison in 2007.

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