Idea Cellular Sinks 9% On Reports Of Providence Stake Sale In The Company

Business

oi-Sunil

By Sunil Fernandes

Published: Friday, June 3, 2016, 10:36 [IST]

Shares in Idea Cellular fell 8 per cent, after CNBC TV 18 reported that Private Equity Fund, Providence will sell its stake in the company.

"It will be a large transaction which is worth about USD 200 million or Rs 1346 crore. Shares will be sold in block trades at Rs 110.50 - Rs 112.50/share, at a discount to the current market price of around Rs 118, say sources. Providence has been looking at selling this stake for quite some time now," CNBC TV 18 reported.

The shares of Idea were last trading at Rs 108.95, down 9 per cent in trade.

Shares in telecom stocks have not been doing well over the last few years, as regulatory hangover continues.

Most of these stocks are saddled with heavy debts on their books, with margins being under pressure due to low rates.

Emerging competition from the likes of Reliance Jio has only compounded worries for investors.

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