Essar is British firm Vodafone’s partner in India’s No 3 mobile firm, Vodafone Essar, in which it holds a 33 per cent stake. The talks are preliminary, and Essar has not yet appointed banks to handle the process, said the sources.
Essar and Vodafone declined to comment. In 2007, Vodafone bought a controlling stake in Hutchison Whampoa Ltd’s mobile business in India, in which Essar had been a partner.
The deal gave Essar the option to sell its entire 33 per cent stake in the telecom venture to Vodafone for $5 billion between the third and fourth years after the deal’s completion.
Alternatively, Essar could sell shares worth between $1 billion and $5 billion in the company to Vodafone at an independent valuation. The option for sale opened in May and runs for 12 months.
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