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India : Mumbai FIPB deferred its decision on the acquisition bid of VODAFONE INDIA
Publish Date : 17-Jun-2016
The Foreign Investment Promotion Board (FIPB) has decided to adjourn its verdict for the proposal of Vodafone India for the acquisition of the entire stake of the cable broadband provider YOU Broadband India.
It can be recalled that Vodafone India has decided to acquire 100% of the cable broadband player, owned by TRG Capital, for an amount of Rs 400 crore (Rs 4 billion).
The telecom major has agreed for the acquisition in order to reinforce its footprint in the home broadband market segment.
Vodafones proposed deal, which has emerged prior to the impending commercial launch of Reliance Jio, will facilitate the company with access to the 3000km of optic fibre cable and 6000km of last mile coaxial cable network now owned by YOU.
YOU Broadband, which delivers broadband services to residential, SME and corporate customers across 12 cities, has already made Rs 400 crore (Rs 4 billion) in investments in these operational markets for the development of broadband cable infrastructure.
YOU Broadband has set up the network jointly with Motorola, Avvaya, Commscope and Cisco, among others.
As of the end of March this year, YOU Broadband has a subscriber base of 0.53 million.
The Central Government has offered its clearance to a pair of bid worth Rs 2.19 crore (Rs 21.9 million) following the FIPB suggestion and referred one proposal to the Cabinet Committee of Economic Affairs (CCEA) for approval.
The FIPB had decided this at its 235th meeting held on 20 May, 2016.
Aurobindo Pharmas FDI proposal is valued at Rs 2.19 crore. Sterling Commerce Solutions India also sought approval for its offer to serve as an investing firm.
