Grapevine: China Mobile in talks for India cloud network; Allahabad Bank to part-exit JV
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China Mobile, the Asian nation's largest mobile operator, has held early-stage talks with telecom service providers Bharti Airtel Ltd and Vodafone Idea Ltd to jointly develop a cloud network here.

“China Mobile is interested in the Indian market and wants to come as a holding company with either of these two companies or even both,” a person aware of the matter told Mint.

“China Mobile has grown the cloud space in its home market and is now scouting for investment opportunities overseas,” the person added.

If the talks end in an equity investment, it will give the two Indian operators the financial muscle to fight Jio in the competitive telecom battleground and offer cutting-edge cloud services to accommodate increasing digitisation and the roll-out of 5G technology which entails storing large amounts of data on the cloud.

Allahabad Bank, one of the promoters of Universal Sompo General Insurance, is looking to sell a part of its 28.5% stake to overseas partner Sompo Japan Nipponkoa Insurance, preferably ahead of its merger with Indian Bank. However, disagreement over valuation has been delaying the process, two people familiar with the development told The Economic Times.

Sompo Japan owns 34.61% interest in the JV and is keen to raise its stake up to 49%, the maximum permissible under Indian law. Allahabad Bank and Indian Bank will be merged in April as part of the mega merger exercise announced by the government.

SPA Securities valued the insurance company at Rs 4,400 crore ($620 million at current exchange rate) but Sompo has been pressing for a lower valuation, the persons said.

Indian Overseas Bank is another partner in the JV with 18.06% shareholding. Both the banks are looking to offload stakes. However, a shareholding agreement has a binding clause that the combined stake of Allahabad Bank and Indian Overseas Bank cannot go below 28%.

Other stakeholders in the JV are Karnataka Bank (6%) and Dabur Investment Corp. (12.81%).

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