Essar seeks 'partnership of equals'

New Delhi: The Essar Group on Monday raised its stakes, claiming "partnership of equals" with Vodafone and joint management in Hutch-Essar.

The Ruias, who owns the Essar Group, had last week announced that the group was not going to exit the business and that it was ready to do business with Vodafone.

Essar was upset with the Vodafone deal, firstly over way the Hutchison Group decided to sell its majority stake to the British telecom major without giving it the right of first rejection and secondly over the Vodafone's announcement on network sharing with rival Bharti Airtel without consulting the group.

The CEO of Vodaphone, Arun Sarin, later called on the Ruias at their residence in Mumbai and seemed to have ironed out the differences between the two. The Vodafone chief, in fact, had gone on record saying he respected the Ruias as partners and that the two would take the business forward together.

"I know Ruias from a long ago. I respect their partnership. They have created value in the business. We are now trying to iron out issues and will take the business forward together," he said.

But on Monday, the Ruias gave a new twist to the issue, saying it will start talks with Vodafone this week on the issue of "partnership of equals".

"We want 'partnership of equals' with Vodafone and joint management in Hutch-Essar," it said. The group clarified that it "never looked for a premium to exit Hutch-Essar. We are incumbent partners," Essar Teleholdings CEO Vikash Saraf

said. Hutch-Essar's enterprise value jumped to $18.8 billion from an initial partnership of $800 million dollars in 2000, the group said.

"Where is the question of seeking a premium?" he wondered and said: "The fundamental tenet of the partnership with Vodafone will be a partnership of equals where both sides

have a meaningful role. This will be the basis for any

agreement with Vodafone."

Asked about Vodafone's response to the Ruias, Saraf said: "We have communicated our views. Discussions are at a preliminary stage. They (Vodafone) have also expressed almost similar views, saying that Essar can add lot of value."

"This is an early stage. But we want the shareholder agreement to address all aspects including when the partners are working together to add value and in the eventuality, if any, of either of the partner quitting," Saraf said.