New Delhi: Tatas, Reliance, Bharati-Singtel and BPL emerged the frontline runners along with surprise contenders, Videocon and Sterling to acquire a controlling stake in the Videsh Sanchar Nigam Ltd (VSNL) as the bids closed on Tuesday evening for disinvestment of the monopoly international voice carrier.

Officials of the Tatas, Reliance and Bharati have confirmed making bids. While the ministry sources were tight-lipped, VSNL indicated the number of contenders could well touch ten for the country's biggest ever privatisation of the New York Stock Exchange listed state firm.

All these contenders have submitted their “Expression of Interest” (EoI) to the Inter Ministerial Group through the advisors - SBI Caps and Credit Suisse First Boston.

The Government is disinvesting 25 per cent of its 52.97 per cent stake in VSNL to a strategic partner along with transfer of management control. Another 1.97 per cent will be sold to VSNL employees.

A consortium of Bharti and Singapore Telecommunications Ltd has bid for a controlling stake in VSNL.

Singapore Telecom holds a 15 per cent stake in Bharti Televentures. SingTel's interest in VSNL merely a follow-up of its investments in India.

The Tatas have put up the bids through the unlisted Tata Industries Ltd, which in turn will remain on the lookout for a consortium partner for running VSNL.

Reliance has made a bid in the cash rich VSNL as it add synergies to the group's ambitious plans to emerge as the leading telecom player in the country. The group is setting up a Rs 30,000-crore broadband network throughout the country in its attempt to take on the Bharat Sanchar Nigam Ltd.

Concert, a joint venture between British Telecom and AT&T, which was earlier expected to be in the race, has decided to drop out.

The government has a cap of 49 per cent for foreign equity in telecom companies and in the VSNL the foreign equity component is already 38 per cent. The ADR holding is 30.30 per cent and the Foreign Institutional Investors (FII) holding in the Indian markets is another 7.78 per cent.

Domestic institutions own 6.27 per cent stake in the company, while 2.68 per cent is with the Indian public and employees. Another 1.97 per cent is being divested to the employees of the company.

UNI

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