Tulip exit Qualcomm JV, will use fund to repay FCCB debt

In an interview with CNBC-TV18, Hardeep Singh Bedi, CMD, Tulip Telecom said that the company has exited the joint venture it had with Qualcomm, following the latest development. The company had an investment of around Rs 140 crore in Qualcomm and the 13% stake Tulip had in Qualcomm, is now owned by Bharti, informed Bedi.

Tulip will utilize the funds generated from the stake sale for paying off its FCCB debt and expanding the business further, explained Bedi.

Below is the edited transcript of the interview on CNBC-TV18. Also watch the accompanying video.

Q: Could you tell us what all this means for Tulip Telecom, have you all completely exited from this JV with Qualcomm and how much do you all get?

A: It is true that we have exited from the JV and we have sold the 13% stake that we held to Bharti Telecom.

Q: Can you tell us what was the initial stake valued at? What was being talked about and finally what has it come in at?

A: We had invested Rs 140 crore. The current price I will not be wishing to disclose.

Q: When will the complete ownership be passed on to Bharti?

A: We have already exited the venture and Bharti is now the owner of the 13% stake that we owned earlier.

Q: Have you all made some sort of money by exiting this from your initial investment of Rs 140 crore and will that be showing up in your financials?

A: It was a financial investment and the gains will go towards strengthening of our balance sheets and driving our growth.

Q: If you could throw some more light, we understand Bharti has acquired 26% stake from their global holding, but there will be a 23% fresh equity as well. Could you provide us some nature on that?

A: Honestly speaking, I can only give you information about the 13% that I have transferred to them. We have sold 13% of our stake to Bharti Teleservices and anything else will probably be available only from them.

Q: Will you all be using this money to repay your FCCBs which are due and could you provide us a situation on how the debt will look like post this?

A: Yes, we will be using this money for strengthening the balance sheet including past payment of the FCCB and for growing the business further.

Q: What is the outstanding FCCB at this point, where does the debt stand at and how much will it be reduced by?

A: The FCCB is USD 97 million with an interest component of about USD 40 million and the debt figures are as per the numbers that have been declared.