Regulators in India have approved Vodafone Group PLC’s (NASDAQ:VOD) bid to take complete ownership of its Indian unit after the government there changed a rule in August that now allows telecom companies to have complete ownership of their local divisions in India rather than restricting that ownership to 74 percent, The New York Times reports.
Economic Affairs Secretary Arvind Mayaram told the Times on Monday that India’s foreign investment regulator has approved Vodafone’s plan to take full control of Vodafone India, but the deal still needs to be approved by India’s federal cabinet. The acquisition of the remaining stake in Vodafone India will cost Vodafone Group $1.6 billion, per the publication.
At the moment, the Times reports that Vodafone directly holds a 64.4 percent stake in the company. Vodafone entered India when it purchased Hutchison Whampoa’s (HUWHY.PK) wireless assets for $11 billion in 2007.
Meanwhile, foreign companies are facing a struggle in India, as the country’s regulators are cracking down and trying to increase India’s tax revenue. Vodafone, Hutchison Whampoa, General Electric (NYSE:GE), Nokia (NYSE:NOK), and Royal Dutch Shell (NYSE:RDSA) have been drawn into tax disputes with the Indian government in recent years.