Vodafone Said to Start Bank Selection Process for India IPO

  • Deal could be one of India's largest initial public offerings
  • Vodafone may pick advisers for IPO of $20 billion unit by May

Vodafone Group Plc has started the process of choosing arrangers for a listing of its Indian wireless business, people with knowledge of the matter said, in what could be among the country’s biggest initial public offerings.

The Newbury, England-based company asked interested investment banks to sign non-disclosure agreements before receiving more detailed information on the India unit, the people said, asking not to be identified as the information is private. Vodafone, which may sell about 10 percent of the India business through the share sale, could pick advisers by next month, according to the people.

Vodafone India, the country’s second-largest wireless carrier after Bharti Airtel Ltd., could be valued at about $20 billion in the offering, people with knowledge of the matter said in October. The share sale would give Vodafone funds to expand as rising wages help growth in India outpace more mature markets like the U.K.

Vodafone shares rose 1.6 percent at 226.40 pence at 8:20 a.m. in London, climbing to a two-month high.

‘Complicated’ Process

Vodafone Chief Executive Officer Vittorio Colao said in February the company still plans to list its Indian unit, though the process is “complicated” and exact timing is difficult to predict. Ahead of a stock offering, the company has also been assessing the potential impact of new competitor Reliance Jio Infocomm Ltd., people familiar with the matter have said. Jio’s so-called fourth-generation high-speed wireless service is due to roll out in the coming months.

“We have previously stated that we have started preparations for a potential IPO, which includes private conversations with banks, but this is a lengthy process and no decision will be made until we are at the end of it,” Vodafone spokesman Matt Morgan said, declining to comment further.

Vodafone bought billionaire Li Ka-shing’s mobile-phone business in the country in 2007, a deal that has also resulted in an ongoing dispute with the tax authorities. Indian authorities have sought to collect taxes on the purchase because it involved the assets in the country. Vodafone has said it doesn’t owe the Indian government money because the deal was conducted offshore.

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