Sharemasterindia.com: Shares of Tata Teleservices (Maharashtra) surged 20 per cent on Monday after a news report said that Tata Group has offered to buy out the stake of Japan's NTT Docomo at Rs 23.34 a share.
The Business Standard newspaper in a report said that Tata group has offered to buy NTT Docomo's 26.5 per cent stake in Tata Tele at Rs 23.34 a share , valuing the Indian telecom company at Rs 11,000 crore.
At 10:44 p.m., shares of Tata Teleservices were up 20 per cent at Rs 8.46.
Under the original deal signed in 2009, when DoCoMo invested $2.2 billion in the Indian telecom operator at Rs 117 a share, it was agreed that in the event of an exit, the Japanese company would get the higher of either half the original investment or fair value.
Tata group had earlier sought the Reserve Bank's approval to purchase the stake at half the price Docomo paid in 2009 - at Rs 58 - after it failed to find another buyer. However, the RBI denied approval to the proposal, citing Foreign Exchange Management Act (FEMA) regulations, which govern cross-border transactions.
The Tata Group's latest offer is based on PwC's recommendations which was appointed to determine the fair value of Tata Teleservices.
Docomo has initiated steps for resolution of the matter through arbitration.
