Three wise men who exited Vodafone India just in time to make millions

• Ajay Piramal received ₹8,900 crore, a whopping 52% return or $1.4 billion as per the exit agreement from vodafone-Idea.
• Singh however exited Vodafone India in 2014 by selling his entire stake to its parent company Vodafone for ₹1, 241 crore.
• Essar agreed to sell their stake at $5 billion which was a part of the deal
• Here is a look at these three wise men

The owners and shareholders of Vodafone Idea alike are nervous about its survival. All thanks to Supreme Court’s move to support Indian telecom department over a dispute on revenue calculations. That means Vodafone is saddled with a bill of ₹44,150 crore.

But not all those who invested in Vodafone have lost. In fact, three investors made the right bet at the right time and walked away with handsome profits. Here is a look at these three wise men

Ajay Piramal makes 52% returns on his investment

Right after the first telecom war cooled off, Vodafone India (before merger with Idea) was back in the green due to reduced competitive intensity. That is when Vodafone was planning to go ahead with a public offer.

One of the pre-IPO investors was Ajay Piramal who via Piramal Enterprises purchased 11% stake in 2011-12. He paid ₹5,864 crore but when it became obvious that the IPO plans were not going through, he also sold them in 2014. And, he received ₹8,900 crore, a whopping 52% return or $1.4 billion, as per the exit agreement.

Putting it simply, he received a listing premium for an IPO that never happened. Now of course, the Piramals are associated with the reigning telecom giant Jio, by marriage. Ajay Piramal’s son Anand Piramal is married to Isha Ambani, the daughter of Mukesh Ambani, the owner of Reliance Industries.

Analjit Singh exits his legacy investments for ₹1, 241 crore

Analjit Singh, the founder and chairman of Max India, and his wife held 24.65% in Vodafone through Scorpio Beverages. He had been with the Hutch group before it was purchased by Vodafone and also increased in stake later.

Singh however exited Vodafone India in 2014 by selling his entire stake to its parent company Vodafone for ₹1, 241 crore. He got 1/7th of what Piramal received, as the British parent was increasing its stake in the company. He currently heads Max Group that comprises of three holding firms, namely Max Financial Services, Max India and Max Ventures and Industries.

The Ruias of Essar call in the cash with their put option

When Ruias of Essar sold 67% of controlling stake to Vodafone in 2007, they never exited completely. They had held 33% minority stake in the company. The former deal which landed Vodafone in an unexpected tax case, also provided Ruias with a put option to exit their investment.

During the start of this decade, Vodafone was planning an IPO and buying out all the minority shareholders. After multiple rounds of negotiating and dilly dallying, Essar agreed to sell their stake at $5 billion which was a part of the deal. However, since the 2007 deal was brokered, the value of India business had gone down due to severe competition as Tata DoCoMo made an entry in 2008.

See also:
Vodafone-Idea is now a ₹3 stock after a shocking quarterly loss
Vodafone CEO Nick Read hints at a possible collapse without government support