Hindujas to bid for hutch stake

After a gap of two decades, the London-based Hinduja group is again on the prowl in India. The Hindujas, who acquired Ashok Leyland from British Leyland in 1987, today decided to put in a bid for Hutchison Essar, the country's fourth largest telecom company.

This followed an intimation to them today from the Hong Kong-based Hutchison Whampoa about its majority stake in Hutchison Essar being up for sale.

When contacted, Ashok P Hinduja, chairman of the group's Indian operations and the youngest of the four Hinduja brothers, told Business Standard, "The horse is ready for the race. And we are ready to ride it."

However, the Hinduja group will bid only after the receipt of a written communication from Hutchison Whampoa in this regard.

Hinduja had written to Hutchison Whampoa a few days ago, seeking to know whether its stake in Hutchison Essar was up for grabs. Hutchison today verbally invited him to bid for its stake in the company.

However, the group was not forthcoming on details of the proposed bid.

Analysts said an offshore company could be the investment vehicle for the proposed bid. The group might take some financial investors/ private equity firms as its partners, they added.

Financing would not be an issue for the group that had business interests in global finance, telecommunications, film, oil and the automotive sector.

The Hinduja brothers, in addition to their global revenue of $14 billion, have reported wealth of $15 billion. As it suits the tight-knit family, its assets have not been divided among the brothers but held by the House of Hinduja. The strength of their finances is evident from the fact that they are a debt-free group.

The Hindujas earlier had equity interest in Fascel, the Gujarat operations of Hutch. In fact, they brought Hutchison to India. They were associated with Hutchison Essar for seven years and snapped ties with it only six months ago by divesting their 5 per cent stake to Hutchison for $ 450 million.

Last summer, the Hindujas acquired one of London's most expensive and sought-after properties, previously owned by the Queen. They paid $112 million for a 100-year lease on the 60-room property at Carlton House Terrace on the Mall, and plan to spend another $100 million on it for use by the joint family.