India Spice Telecom: Telekom Malaysia Buys 49% Stake

NEW DELHI -(Dow Jones)- Telekom Malaysia has taken a 49% stake in India's Spice Telecom, said a senior executive of the mid-sized mobile phone company Friday.

"They (Telekom Malaysia) are buying a 49% stake," Prakash Nanani, president of Spice Telecom, told Dow Jones Newswires.

Nanani didn't say how much money Telekom Malaysia, Malaysia's fourth-largest company by market capitalization, paid for the 49% stake in privately owned Spice Telecom.

He said more details about the transaction will be disclosed at a news conference scheduled for 0900 GMT in Kuala Lumpur.

Nanani said government-controlled Telekom Malaysia bought the 49% stake held by Ashmore Investments and Deutsche Bank.

"They will buy into the existing equity (of Spice Telecom). No fresh shares will be issued to them," he said.

The Modi family will retain its controlling 51% stake in Spice Telecom after the share sale.

Spice Telecom is India's seventh-largest GSM operator by subscribers. At the end of February, the company had 1.82 million subscribers.

The company currently operates in the Punjab and Karnataka telecom circles.

Nanani said Spice has applied for licenses in the telecom circles of Jammu & Kashmir, Uttar Pradesh East, Uttar Pradesh West, Haryana, Himachal Pradesh and Rajasthan.

-By Santanu Choudhury, Dow Jones Newswires; 91-11-23074020; santanu.choudhury@dowjones.com

-Edited by Marissa Chew

(END) Dow Jones Newswires"

Posted to the site on 10th March 2006