Open Offer of Tata Teleservices (Maharashtra) Ltd. (TTML)

Observations in Public Announcement (PA) for Open Offer of Tata Teleservices (Maharashtra) Ltd.

1. Tata Sons Ltd. (TSL) has been teamed up as PAC (person acting in concert) with the acquirer NTT DOCOMO INC. Japan. TSL is already identified as promoter (TSL Holds 20.72% shares in TTML) in the corporate filing by TTML as on 30th September 2008. Thus the Open Offer should be under Reg. 10,11 & 12 and not merely Reg. 10 & 12

2. TSL has been identified as PAC (“Refer clause 8 of PA”) in terms of Regulation 2(1)(e)(1) of the SEBI (SAST) Regulations, however the definition o PAC given in the said clause does not fit TSL. TSL is not acting “for a common objective or purpose of substantial acquisition of share or voting rights or gaining control over the target company” as stipulated in the regulation. Rather TSL’s objectives are just the reverse & contradictory. TSL as such can not become PAC of the acquirer.


3. In clause 4 of PA it is mentioned that (“The Acquirer also proposes to enter into a share Purchase Agreement (“SPA”)”),with TSL to acquire a further 6% of the fully diluted equity share capital of TTSL”) thus on the one hand TSL is selling the shares and on the other wants to buy the shares through the open offer. Such arbitrage opportunities can not be allowed.

4. Even the reputed promoters like Docomo & Tata’s are shying away from acting in a transparent manner and disclosing full facts of valuation. Negotiated price, obligatory for them to disclose as per the regulations, has not been given. Please refer clause 16(a) of PA --against negotiated price it is written ”Not Applicable” This statement is far from truth. When the object and interest is the target company, obviously a specific valuation must have been attributed to Tata Teleservices Ltd. (TTSL) interest in the target company. It is worthwhile to note that the Acquirer & PAC let the whole world know the basis of valuation which has been reported as $354(Rs. 17,271) per subscriber (see attached report).

In the light of the above you are requested to please:

1. Clarify whether a promoter and seller can also be an acquirer for the open offer? If not, TSL may be asked to not act as PAC.

2. As per the press report attached TTSL has been valued at Rs. 50604 Crs. On the basis of 29.30 million subscribers at Rs. 17,271/- ($354) per subscriber, accordingly the valuation for TTML can be worked out. On 20th May 2008 TTML informed NSE that it has crossed 5 Million Subscribers. This means that the valuation of TTML has been considered at Rs.8,635 Crs. Or Rs.45 per share. NTT DOCOMO and Tata’s must be asked to give truthfully the valuation per share of TTML considered for the transaction.
3. The negotiated price as above must be disclosed & in case it is higher than the offer price of Rs.24.70, then the offer price must be suitably revised.