The latest milestone in these lines which is in the limelight is the much debated case of vodafone acquisition of hutchison essar which involved the issue of tax liability. It is a landmark case that will severely impact the mergers and acquisitions landscape in india. Last year british telecom giant vodafone paid hong kong based hutchison international over usd 11 billion to buy hutchisons 67% stake in. Pixabay the coronavirus pandemic will not prevent the merger between vodafone hutchison australia and tpg telecom from going ahead by midyear, the two companies involved have indicated.
Vodafone idea also provides services including mobile payments, iot, enterprise offerings and entertainment, accessible. You may recall vodafones famous ad that featured in 2008 with the tagline every day i want to fly, and a pug. Case on merger acquisition of hutch and vodafone marketing essay. As of august 2016, vodafone india has a market share of 18.
Vodafone says it may acquire stake in hutchison essar. The ruia familyowned essar group has embarked on the final leg of its deleveraging exercise with plans to cut down its residual debt by 70 per cent to about rs 12,000 crore as it looks to rebuild the conglomerate postoil and steel business selloffs. As of march 2018, vodafone india has a market share of 21% and with its merger with idea, the collective vodafone idea network has approximately 375 million subscribers and is the second largest mobile. Merger of vodafone and hutch companies business scribd. In the yearthe worlds largest telecom company in terms of revenue, vodafone plc vodafone made a major foray into the indian telecom market by acquiring a 52 percent stake in the indian telecom company, hutchison essar ltd hutchison essaracquisltion a deal with the hong kongbased hutchison telecommunication international ltd. What exactly was the problem in the vodafonehutchison tax.
The question that arose in this case was whether the transfer of an indian entity by one nonresident company to another will give rise to an incident of capital gain. Relations between hutchison telecom and the essar group of india will be key to the sale of hutchs 67% stake in hutch essar. Case study of hutch and vodafone international essays. Use the free adobe acrobat reader to view this pdf file summary. London, march 15 reuters britains vodafone group plc said on thursday it had reached an agreement to gain operational control of indian mobile company hutchison essar in.
The vodafone hutchison case and its implications vccircle. Vodafone idea also provides services including mobile payments, iot, enterprise offerings and entertainment. Vodafone announced on 11 february 2007 that it had agreed to acquire hutchison telecommunications international limiteds controlling interest in hutchison essar, in which essar is and will continue to be a 33% shareholder. A decade ago in 2007, vodafone international holdings bv forayed into the indian mobile phone market by buying 52% stake in hutchison essar. Firstly, by making its own infrastructure, opening braches across india, recruiting its workers and what not. The hutchison essar acquisition linkedin slideshare. It offers both prepaid and postpaid gsm cellular phone coverage throughout india with good presence in the metros. Vodafone essar, previously hutchison essar is a cellular operator in india that covers 23 telecom circles in. Vodafone s foray into india vodafone was looking to enter indian market.
Merger of vodafone and hutch free download as pdf file. It can be seen that vodafone group plc it is a uk registered parent company of vodafone group made the offer. In 2007, worlds one of the largest telecommunication country from revenue point of view vodafone played a major role and decided to expand their business in indian by acquiring 52% of shares of. After the deal, hutchison essar has been changed to vodafone essar, and. Acquisition of hutchison essar india by vodafone american. The hutchison essar group contained 67 % stake of hutch and 33% stake of essar. Vodafone essar, previously hutchison essar is a cellular operator in india that covers 23 telecom circles in india. Vodafones creative math may pay off in hutchison essar deal updated feb. Despite the official name being vodafone essar, its products are simply branded vodafone. Hutchison essar limited, a hong kong based company was renamed as vodafone in july 2007 as vodafone acquired 67% in hutchison essar from hong kong based hutchison whampoa, in a bid to enter the. Vodafones foray into india vodafone was looking to enter indian market. Vodafone hutchison deal vodafone acquired htil hutchison telecom internationals 67% stake in hutchison essar.
Vodafone hutchison deal vodafone acquired htil hutchison telecom internationals 67% stake in hutchisonessar. Vodafone has acquired 67 per cent in hutchison essar from hong kongbased hutchison whampoa, and completed the acquisition of hutchison essar in may 2007. Vodafone acquired htil hutchison telecom internationals 67% stake in hutchisonessar. Vodafone, the uk based mobile giant on the other hand is the highest revenue earning mobile service operator in the world.
Telecommunications international, had joint venture with essar in hutchison essar. Tough economic times have triggered an upheaval in australias billion a year mobile sector with its number three and four players vodafone australia and hutchison quot3quot forced into merger. Vodafone idea limited is an indian telecom operator with its headquarters based in mumbai, maharashtra and gandhinagar, gujarat. Vodafone company in england wanted to enter in indian market in 2007.
Essar confirmed that it had received an offer to partner. Vodafone acquires hutchison essar stake financial times. Case on merger acquisition of hutch and vodafone marketing. A case in international taxation of indirect transfer. Hutchison essar is a leading indian telecommunications mobile operator with 25 million customers currently, representing. The hutchisonessar group contained 67 % stake of hutch and 33% stake of essar. International journal of advance research in computer.
Merger a merger involves the mutual decision of two companies to combine and become one entity. Essar to further cut down debt by 70 pc in last leg of deleveraging exercise 11 mar, 2020, 02. The tax season just ended in india with the end of the year tax assessments on september 30 and many companies were busy with their filings. New delhi vodafone group said sunday it had won control of one of indias fastest growing telecommunications companies, hutchison essar, with an offer that valued the company at. But fdi policies were not favorable on feb 11, 2007 a vodafone group plc an uk based telecom company acquired hutchison essar ltd hel. All you need to know about vodafone tax case zee business. Vodafones creative math may pay off in hutchison essar deal. The result of a 2009 merger between vodafone australia and hutchison 3g australia, it is australias third. Analjit singh and asim ghosh together hold 15 per cent, while essar holds 33 per cent. Vodafone hutchison australia pty limited, doing business as vodafone australia or vodafone hutchison australia vha, is a mobile telecommunications company and internet service provider that operates the vodafone brand in australia. Vodafone india is the indian subsidiary of ukbased vodafone group plc, the worlds secondlargest mobile phone company, and is a provider of telecommunications services in india with its operational head office in mumbai. An analysis of financial performance of vodafone plc and hutchison essar. Vodafone gets daytoday control of hutchison essar reuters. Vodafones foray into an emerging market case study case code.
Notice convening meeting of the unsecured creditors of vodafone india limited, under the provisions of sections 230 to 232 of the companies act, 20 read with rule 6 of the companies compromises, arrangements and amalgamations rules, 2016, pursuant to order dated 17 august 2017. No comments could be ascertained from vodafone, essar and. Indusview chairman bundeep singh rangar discusses indian mergers and acquisitions in light of vodafons bid for hutchison essar on cnbc. Comerford acquisition of hutchison essar india by vodafone u. This led to renaming company to vodafone essar and rebranding of hutch as vodafone. Recently, vodafone and idea announced a merger that will create indias largest telecom operator with. In april 2014,india based piramal group sold its 11% stake in vodafone india to prime metals,an. Vodafone india wikimili, the best wikipedia reader.