Plans for an initial public offering by the Indian telecoms venture between Britain's Vodafone and Essar Group are in initial stages, with both partners set to discuss options before making a final decision.Indian steel-to-shipping conglomerate Essar Group has been in talks with banks to explore options, including an IPO, for its 33 percent stake in No. 3 Indian telecoms firm Vodafone Essar, sources had told Reuters earlier this month."All options are open. An IPO is one of them," Prashant Ruia, chief executive of the Essar Group, said on Thursday.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 percent stake in the telecom venture to Vodafone for $5 billion between the third and fourth years of 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 the sale opened in May and runs for 12 months."We have a partner here. We will decide together what to do," Vodafone Chief Executive Vittorio Colao told reporters in the Indian capital on Thursday.NO TAX DUEVodafone is fighting a tax bill in India from its 2007 purchase of Hutchison Whampoa's mobile business in the country, and had filed an appeal with a Bombay court in June challenging the tax department's jurisdiction over the tax bill.The court has rescheduled a hearing of Vodafone's appeal to Aug. 2, a Vodafone representative said earlier this month.Vodafone has not said how much the authorities were seeking, but a person with knowledge of the matter has said it was about 120 billion rupees ($2.6 billion)."We continue to be convinced and advised that no tax is due. We have made an acquisition in this country. We have not sold assets," Colao said on Thursday."We have confidence in the court process. India has a very solid legal system," he said.Vodafone has signalled frustration with its Indian unit, and Colao has said that India's telecoms rules did not make sense."We need stable policies. We need investment-oriented policies. Players like us who believe in this market, who invest in this market, who have brought competition in the market should be allowed to continue the investment strategy," Colao said.($1=46.6 rupees)(Reporting by Nidhi Verma and Devidutta Tripathy; Writing by Pratish Narayanan; Editing by Ranjit Gangadharan)News posted by www.newsinfoline.com
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