FIPB clears Tesco, Vodafone investment proposals
New Delhi: UK-based Tesco Plc became the first global retailer to get approval to enter country's multi-brand retail sector from the Foreign Investment Promotion Board that also Monday cleared Vodafone's Rs 10,141 crore plan to buy out minority shareholders in its India arm.
A decision on the proposal of HDFC Bank to increase Foreign Institutional Investor (FII) holding limit was, however, deferred, Finance Ministry sources said.
Tesco Plc's plans to initially invest USD 110 million in the multi-brand retail foray, including for the acquisition of 50 percent stake in Tata group firm Trent Hypermarket Ltd.
As regards to Vodafone, the FIPB has given go ahead to the British telecom major to buy out minority shareholders like Ajay Piramal and Analjit Singh in its Indian arm at an estimated cost Rs 10,141 crore.
Piramal holds an 10.97 percent stake in India's second-largest telecom company by subscribers, while Singh, who is Vodafone India's non-executive chairman, holds 24.65 percent. Vodafone Group Plc will pay Analjit Singh Rs 1,241 crore and Piramal Enterprises Rs 8,900 crore for their stakes in Vodafone India as part of a proposal.
However, since the investment is of more than Rs 1,200 crore, the company's proposal also requires clearance from the Cabinet Committee on Economic Affairs (CCEA).
CGP India Investments Ltd, an indirect Mauritian subsidiary of Vodafone International Holdings BV, had sought FIPB approval to buy the stake held by minority shareholders in Vodafone India Ltd.
The FIPB has also approved foreign investment proposals of Johnson & Johnson.
HDFC Bank's proposal, which was deferred, pertains to raising FII holding limit beyond the existing 49 percent in the bank.