Bahrain Telecommunications Co (Batelco) has struck a deal to sell its entire 42.7 per cent holding in STel Private Limited (STel), an Indian mobile operator, to its local joint venture partner Sky City Foundation Limited for $174.5 million, the company said on Wednesday. This makes it the first foreign investor to announce an exit from India after the country’s apex judiciary in a landmark judgement last week scrapped  122 telecoms licences as part of a corruption probe.

Batelco’s Group chief executive, Shaikh Mohamed bin Isa Al Khalifa, said, “BMIC Limited, a 100 per cent Batelco owned subsidiary company, entered into an agreement, in the fourth quarter of 2011 to sell its 42.7 per cent equity in STel for BD 65.8M ($174.5 million) to its Indian partner, Sky City Foundation Limited.” The agreed time frame for completion of the sale is the end of October 2012.

As stated in previous press statements, BMIC had decided, as early as April 2011 to actively pursue the sale of this investment. Batelco Group had disclosed in its financial accounts for the period ending 30 June 2011, that BMIC’s investment in STel was presented as an asset held-for-sale, the company disclosed.

BMIC acquired 42.7 per cent equity in STel via two transactions in May and June 2009 for a total of $174.5 million, which implies it has exited at par.

“As Batelco continues to grow and diversify its operations, we remain interested in other investment opportunities for the Batelco Group that will enable us to participate in the Indian telecom market. We are actively exploring all options in this respect over the coming months,” concluded Shaikh Mohamed.

S Tel had total subscriber base of 3.55 million as of December 31, 2011 with just 0.4 per cent market share of the total pie. It holds licenses for six of the total 22 telecom circles in the country. It is among the new crop of telecom firms which received licenses to operate in India in 2008.

Another foreign telecom firm which is mulling an exit from India as a fallout of the recent scrapping of all the licenses granted in 2008, is Norway’s Telenor which has a joint venture with Unitech under the brand Uninor.

Among those hit by the latest ruling includes UAE’s Etisalat which also has a large minority stake in an India affiliate Etisalat DB.

Also Read:

Supreme Court Quashes 122 Telecoms Licences

Telenor May Quit India After Licences Revoked

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