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Providence makes partial exit from India's Idea Cellular

  • Andrew Woodman
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Providence Equity has made a partial exit from Idea Celluar, a Indian mobile network operator promoted by Aditya Birla Group, selling a 2.3% stake - or a quarter of its previous holding - for around INR14.1 billion ($234 million) via an open market transaction.

The exit from the eight-year-old investment is understood to have generated 3x money multiple, or an IRR of 15%, not counting dividends.

Providence continues to hold 6.8% stake in the company, which is valued at around INR50 billion based on the current market price. Some of the shares were bought by institutional investors Capital World Growth and Income Fund and EuroPacific Growth Fund.

Providence originally bought a 15% stake in Idea for around INR18 billion in 2006, a year later the company floated on the Bombay Stock Exchange (BSE). The GP then saw its stake diluted further in 2013 through share sale.

Providence focuses on investments in the telecom, media and technology sectors and has separately invested in the telecom tower firm of Aditya Birla Telecom. Other related portfolio assets include cable and satellite television service provider Hathway Cable and Datacom, home shopping firm Star CJ Network India and digital entertainment solutions provider UFO Moviez India.

Shares of Idea Cellular closed at INR167.25, down 2.96% on the BSE in a flat Mumbai market on Thursday.

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