Docomo Is In Love With Tata Tele

[@ksh@T 20]

TOKYO: will buy a stake of about 26 per cent in Tata Teleservices Ltd for 260 billion Wi-fi wireless networks

yen ($2.7 billion), Japanese business daily the Nikkei Wi-fi wireless networks

reported on Wednesday.

The deal would add to a record value of overseas acquisitions by Japanese firms this year as companies increasingly snap up competitors abroad, taking advantage of tumbling global stock markets and the yen's

recent surge.

Company sources said in September DoCoMo was in talks to buy a stake in Tata, part of the Tata Group conglomerate and parent of Tata Teleservices (Maharashtra) Ltd.

It would be the latest of a series of overseas acquisitions by DoCoMo and follows $350 million investment in Bangladesh's No.3 cellphone carrier.

Shinji Moriyuki, a telecoms analyst at Mitsubishi UFJ Securities, said DoCoMo's recent acquisitions in Asia would be positive for the company, especially with its extensive knowledge of third-generation network services to which many developing countries are now moving.

"Many people have voiced concerns because of its overseas investment spree in the early 2000s and failures afterward, but business conditions are totally different now," Moriyuki said.

"This time, the acquisition value should not be too large because of sluggish stock markets, it can count on growth in developing markets, and both parties (DoCoMo and Tata) should be able to find synergies because of the current timing that 3G services are about to be launched."

DoCoMo spent nearly 1.9 trillion yen in the late 1990s and early 2000s to buy small stakes in operators around the world to promote use of its i-mode mobile Internet technology and ensure the adoption of 3G networks on the same W-CDMA standard that it uses.

But it saw its investments sour, and pulled out of AT&T Wireless Services Inc, Dutch operator KPN Mobile N.V. and Hutchison 3G UK Holdings after incurring heavy losses. JAPAN FIRMS GOING ABROAD

Acquisitions abroad by Japanese firms in 2008 already total almost $63 billion, according to Thomson Reuters data, and DoCoMo's Tata investment would come a day after Japanese chemical maker Mitsubishi Rayon announced a $1.6 billion acquisition of British rival Lucite International.

[vIa: ET]

Tata Teleservices up 7% on DoCoMo stake buy

MUMBAI: Shares of Tata Teleservices rose 7 per cent on Wednesday after the report that Japan's biggest mobile-phone operator NTT DoCoMo Inc is planning to buy a stake in Tata Tele.

Reportedly, the Tokyo-based company is resuming expansion overseas after failed investments including Hutchison 3G UK Holdings Ltd. and is in talks with Tata group. However, the latter has not confirmed the development so far.

Indian wireless telephony is one of most fast growing industries so investors may prefer the shares in this segment. In addition, the low price and better profile of the company also attracts the investors, telecom analyst said.

At 10:30 am, Tata tele was trading 7% up at Rs 17.89 and was the top gainer in early trade.

Edited November 12, 2008 by @ksh@T

[@ksh@T 20]

Tata Tele-Docomo deal over priced: Analysts

[vIa:ET Bureau]

MUMBAI: Even before the ink on the dotted line has dried, analysis has begun on Wi-fi wireless networks valuations of the Tata-DoCoMo deal. The verdict - the deal is over priced.

With the valuations of Tata Teleservices Ltd (TTSL), India's sixth largest operator pegged at $10 billion, analysts say it equals the present market cap of the second largest mobile operator, Reliance Communications. This valuation, the markets feel, is overpriced, considering the relatively small scale of operations TTSL has compared to the big daddies of Indian telecom.

Japanese mobile operator NTT DoCoMo picked up 26 per cent stake in TTSL at around Rs 13,070 crore ($2.7 billion).

TTSL, which holds around 38 per cent in Tata Teleservices Maharashtra Ltd (TTML), is the sixth largest service provider with a market share of 9.3 per cent.

“Prima facie, the price looks exorbitant with $10 billion valuation, the present market cap of second largest operator RCom. For an operator having only 30 million subscribers, this valuation is too high,” said Harit Shah, analyst at Angel Broking.

In fact, the market cap of Reliance Communications stands at around Rs 45,000 crore, which has the largest CDMA subscriber base in the country of 47 million.

In TTSL, Temasek & C Sivasankaran also hold 9.9 per cent and 8 per cent equity, respectively. Sivasankaran bought the stake for Rs 1,200 crore from Tata Sons in March 2006, while Temasek paid around Rs 1,500 crore to Tata Sons, which holds 37.65 per cent stake in Tata Tele Maharashtra, the listed entity of TTSL.

In comparison to the stake bought by Temasek in 2006, analysts said that DoCoMo has paid three times more for the 26 per cent stake. However, they state that with 3G auctions in India likely to start in January next year, for DoCoMo to get a foothold in Indian telecom market at this juncture is crucial irrespective of the high valuation.

“It may seem high but with 3G spectrum under consideration, DoCoMo stands to gain given its exposure to 3G services worldwide,” remarked Romal Shetty, executive director, telecom, KPMG.

NTT DoCoMo is Japan’s largest mobile operator which launched its 3G services on the WCDMA platform as early as 2001.

DoCoMo said that both the companies will leverage each other strengths and will derive significant upside from TTSL's GSM service which will be launched early next year in 20 telecom circles.

Shetty added that DoCoMo was always eyeing small operators like TTSL and Idea, without which it would be difficult for the Japanese service provider to make an entry into the fastest growing mobile market on the planet. And for TTSL, the deal enables it to access resources for their planned expansion.

“For TTSL, it's a good deal as it will help the company in its rollout of GSM plans. The additional money will help meet the capex plans of $2 billion,” an analyst from Khandwal Securities said.

DoCoMo's Tata Tele valuation is more than RCOM's mcap

MUMBAI: The news of Japanese telecom major NTT DoCoMo’s 26% acquisition in Tata Teleservices (TTSL) is just another indicator that the Indian telecom growth story has not died down. The deal struck at $2.7 bn (Rs 12,770 crore) values TTSL at Rs 50,270 crore.

Interestingly, this is higher than the market capitalisation of TTSL’s rival, Reliance Communications (RCOM) which is the largest CDMA player in India. While TTSL’s subscriber base is a little over 30 mn, RCOM’s CDMA subscriber base is at 47.86 mn. RCOM also has a GSM business where it has 9.2 mn subscribers.

Valuations have moved upwards quite steeply in India’s telecom story. In early 2006, Temasek picked up a 9.9% stake in TTSL for Rs 1,500 crore valuing the company at around Rs 15,000 crore. The NTT DoCoMo deal values TTSL at over three times that in less than three years. During this period, TTSL’s subscriber base has also trebled. India brings in around nine million new subscribers every month.

TTSL is looking to enter the GSM space as well and NTT DoCoMo has said that it is looking at an upside from the GSM rollout. More importantly, NTT DoCoMo itself has significant expertise in the 3G area and this alliance is therefore expected to benefit TTSL over time. “The launch of 3G services in India will not be easy and the key will be in offering the service and handsets at an affordable price. NTT DoCoMo could therefore look at just 2.5G for at least two years” argues KPMG executive director (telecom) Romal Shetty.

The deal comes at a time when the recent financial turmoil and economic slowdown has created an apprehension in the minds of many rating companies about the ability of Tata Sons to pay off its debt in different group companies like Tata Steel and Tata Chemicals. In a market where raising debt has become more expensive, the current investment by the Japanese telco would definitely provide some impetus to TTSL in its expansion plans.

The last few weeks have witnessed some hectic activity on the M&A front for Indian telecom. Norwegian telco, Telenor announced its intention to invest Rs 6,120 crore for a 60% stake in an upcoming player, Unitech. This was preceded by Etisalat’s $900 mn investment in another new entrant, Swan Telecom for a 45% holding.

Edited November 13, 2008 by @ksh@T

[dkaile 1,051]

But still, this news will have long term repercursion.... it could shake our mobile market...

[shashank 8]

Even i was surprised seeing the valuation of TTSL @ $10b !

Anyways NTT DoCoMo is technologically advanced company so hoping to see some advanced services from tata :-)

[HetalDP 947]

Its a Long Term View

Just remeber Hutch from Hongkong have Fetched Valuation of Rs. 98000 Crores and still its earning and Subscriber is 20 % less then Reliace Communication, Reliance Communication also owns Flag Telecom and BigTV which is Hidden in Valuation, Flag Telecom Valuation is Rs 9800 crores and RCom is available @ 45000 in Market Cap in Stock Market.

Generally Stack sales are always above the Market Price. If DoCoMo Start Aquiring Stake through the Stock will rise 4 fond in just 20 days by the News of DoCoMo. Stock Market Work on Future Perspective and News

[@ksh@T 20]

Tata Tele to raise data revenues after DoCoMo deal

14 Nov 2008, 1740 hrs IST, REUTERS

MUMBAI: Tata Teleservices expects to earn more revenues from data services as it taps into the experience of its new stakeholder, Japan's NTT DoCoMo, its managing director said on Friday.

About 11 per cent of Tata Teleservices revenue come from data, higher than the industry average of 8 percent in India but well below DoCoMo's share of about 40 per cent, executives said.

"We will also bring in advanced value-added services which the Indian market has never seen before," Managing Director Anil Sardana told a media briefing on Friday.

Japan's largest mobile operator on Wednesday agreed to pay $2.7 billion for a 26 per cent stake in Tata Teleservices, India's sixth-largest operator. DoCoMo Chief Executive Ryuji Yamada said that there were no immediate plans to further increase the stake.

"We have agreed to buy 26 per cent in Tata Teleservices. We have no intention to raise our stake beyond this for the time being," he said.

Tata Tele provides services on the CDMA platform, and is launching services on the more popular GSM platform from January. India is the world's second-biggest mobile market, and the fastest growing.

More than 10 million users signed up in September, taking total subscribers to 315.3 million, of which 233.7 million were on the GSM platform. The deal comes ahead of India's auction of 3G spectrum, a technology of which that DoCoMo has extensive experience.

It also follows a $350 million investment in a Bangladesh telecom by DoCoMo, and the company is confident its foreign buys will be more successful than a spree in the late 1990s and early 2000s, when its investments soured and it incurred heavy losses. "Certainly we have made some mistakes in our investments in the past.

But it was a deliberate investment this time," Masatoshi Suzuki, senior executive vice-president and a member of the board of directors of NTT DoCoMo, told reporters. "We are strongly determined not to repeat the mistake of past investments," he added.

Tata Teleservices will issue new equity as part of the deal. The unlisted telecom is part of the sprawling Tata Group, and group firms own about 80 per cent of it. Temasek owns about 10 per cent of the firm, while investor C.

Sivasankaran holds 8 per cent. Sardana declined to comment on whether group firms would sell their holdings. "There is a plan to issue fresh equity. The details of it are being worked out," Sardana said.

As part of the deal, DoCoMo and Tata Sons, the Tata Group holding company, will make an open offer in January for up to 20 percent of the shares of Tata Teleservices (Maharashtra) the listed unit of Tata Tele, at Rs 24.70.

On Friday, shares in Tata Teleservices (Maharashtra) rose 12.2 per cent to Rs 20.19, their strongest close since October 3 in a Mumbai market that fell 1.6 per cent.

[@ksh@T 20]

Tatas mull mobile handset foray with DoCoMo

15 Nov 2008, TNN

MUMBAI: The Tatas, who stopped making fixed telephone instruments under the Tata Fone brand some years ago, plan a re-entry into the business by developing mobile handsets. Tatas will consider the feasibility of the project in collaboration with its new Japanese partner NTT DoCoMo, which has strong expertise in handset development besides managing next generation technologies.

DoCoMo has an extensive lineup of lifestyle-focused handsets tailored for varying customer needs and preferences like waterproof models, kids' models with GPS tracking and handsets with wellness applications to monitor health and fitness.

DoCoMo has struck a strategic alliance with Tata Teleservices, including buying a 26% stake in Tata Tele. The co-operation between the two wireless carriers is being extended across marketing, handset development and technical support services.

" We will leverage DoCo-Mo's handset designing capabilities and work closely to bring out both high- and lowend models for our customers,'' said a Tata Tele executive. NTT DoCoMo president and CEO Ryuji Yamada said, ‘‘ The company is establishing a task force comprising its directors and technology experts to work on different areas with our Indian partner.''

Another Tata Tele official said, ‘‘ Given that the alliance has just been formed the business model would evolve over a period of time.'' Currently Tata group company DriveIndia .com procures and sells CDMA handsets from manufacturers like Samsung, Nokia, Huawei and Haeir. Tata Tele focuses only on providing mobile services, while group firm Tata Business Support Services handles customer queries and interactions for Tata Indicom and Virgin mobile. ‘‘ With DoCo-Mo as partner, the branding architecture could change,'' said the Tata official.

[Saurav 22]

With this TATA will come up with new good handset models?

[Mufaddal 678]

ya even i m hoping that they come up with good handsets.....docomo is capable of that