Report: Maxis looks to exit India
Maxis Berhad is looking to sell its stake in Indian telco Aircel, with Russia's Sistema touted to be an interested party. This development comes amid regulatory uncertainty regarding the 2G spectrum auction slated for later this year and the ongoing probe into the sale of Aircel to Maxis, one report states.
The Times of India reported on Tuesday that Maxis had held preliminary discussions with bankers representing Sistema, although talks have yet progressed to a "serious" stage of negotiations when the prospective buyer requests to conduct due diligence of Aircel's accounts.
Citing an executive close to Maxis with direct knowledge of the discussions, the Indian news agency stated: "Maxis sees itself as a long-term player in India, but will listen to offers in the wake of regulatory and policy uncertainty. Bankers have brought many potential permutations and combinations for mergers and strategic alliances, including that of Sistema, to the company."
The source said Maxis was upset with the way the Indian government's investigations into the sale of Aircel had dragged the Malaysian telco's founder Ananda Krishnan and other top officials into the probe.
The country's Central Bureau of Investigation (CBI) had alleged that "undue favors" were given following the sale, when then-telecommunications minister Dayanidhi Maran was said to receive 328 million ringgit (US$107 million) for getting Aircel's owner C. Sivasankaran to sell 74 percent stake in Aircel to Maxis.
A Sistema spokesperson, however, said the company was not in talks with Aircel. "Sistema Shyam Teleservices believes that the talk of engaging with other telecom service providers for a possible acquisition deal is motivated," the spokesperson stated in the report.
Despite exploring avenues for exit, the unnamed source added that Maxis will continue to invest in Aircel and recently lined up new leaders for the Indian telco. This is because given the uncertain regulatory landscape and depressed valuations for telcos, it would be difficult to strike a deal now.
Times of India stated that Maxis Group CEO and Aircel Director Sandip Das declined to comment.
Analysts had stated earlier that the lack of urgency within India's government to resolve the allocation of 2G spectrum by fixing an auction date and reserve pricing is a blow to its credibility and will hamper the development of the local telecommunications industry.