NTT DoCoMo buys 26 pc stake in Tata Teleservices

MUMBAI, INDIA: Japan’s telcom major NTT DoCoMo got a foothold in Indian telecom market as it acquired today a 26 per cent stake in the Indian telecom major Tata Teleservices, for $2.7 billion (approximately Rs 13,000 crore), valuing the company at 10.4 billion dollars.

As per Indian regulatory laws, DoCoMo will also have to make an open joint tender offer with Tata Sons, the holding firm of the group, to buy up to 20 per cent in a listed unit of the Indian mobile operator.

"As a result of the capital alliance, the partners expect to expand mobile communication operations in the fast-growing Indian mobile market aiming to increase operating revenue and achieve steady business growth," a press statement from Tata said.

Tata Teleservices has 30 million subscribers, making it the sixth-largest telecom company in India on that parameter.

DoCoMo had earlier made a $350 million investment in a Bangladeshi cellphone carrier.

India is the biggest mobile market in the world, after China and has a customer base of around 320 million, almost three times the size of Japan's market of 109 million subscribers.

According to Gartner India's mobile user base will more than double by 2012.

Tighten belt, says Ratan Tata

Meanwhile, another report said that Tata Group Chairman Ratan Tata has asked CEOs and managing directors of the 98 group companies, gear up to face the situation emerged after the global financial turmoil, and tighten belts.

In a letter to the top executives Ratan Tata has reportedly asked them to review business strategies outlining a six-point action plan keeping in mind the worsening credit crisis.

He suggested them to focus on conserving cash and put off expansion through the inorganic route unless the acquisitions were strategic in nature.