Japan-based telecom player NTT DOCOMO has decided not to exercise the option of increasing its holding in Tata Teleservices Limited (TTSL), say news reports.
NTT DOCOMO has deferred its plans to increase its shareholding in TTSL owing to the uncertain and evolving regulatory scenario in the country. However, it will revisit its plans to further increase its stake in TTSL next year.
Currently, NTT DOCOMO has 26 per cent stake in TTSL. It paid $2.7 billion for acquiring 26 per cent stake in TTSL in 2008. It has two call options. Firstly, to increase its stake in TTSL to 35 per cent in 2012 and secondly raise it to 51 per cent in 2014, thereby taking a controlling stake in the company. The call option gives the investor the right but not the obligation to buy shares at a preset price. Additionally, NTT DOCOMO has the option of selling its 26 per cent stake to TTSL, in case it decides not to exercise call options at its disposal.
