Mumbai, January 12

This could mark the end of an era in Indian mobile telephony’s short history. After Maxis acquired Sivasankaran’s Aircel in Tamil Nadu last month, a big stake in the last surviving regional player, Spice Telecom, is now on sale.

Malaysia’s largest telcommunications group Telekom Malaysia is said to be in talks to acquire a stake in Spice Telecom. Telekom Malaysia, like Singapore-based Singtel, is keen to get a foothold in India’s fast growing telecom market. This is their third attempt — they had earlier tried to buy stake in Idea Cellular and Aircel.

It is learnt that international consulting firm KPMG has the mandate to find a strategic investor for Spice Tele. BK Modi’s Spicecorp (India) holds 51 per cent in Spice Tele while the balance 49 per cent is shared between Deutsche Bank group and Ashmore Investment Management, a financial investor. Modi has the option to buy out stake, failing which it would be sold to a third party. Modi confirmed that he was on the lookout for a strategic partner in Spi-ce Telecom. ‘’We are in talks with various players including Telekom Malaysia,’’ he said, refusing to divulge the names of other players, but added that they were from the Far East and West Asia.

Sources close to the development said Deutsche Bank is in talks with foreign players to sell its stake. However, the talks are still at a preliminary stage. The Deutsche Bank spokesperson declined to comment on the matter.

The valuation of Spice could not be ascertained. The recent buyout of Aircel by Maxis is a case in point. Maxis, alongwith its Indian partner, acquired Tamil Nadu’s leading GSM service provider for Rs 4,860 crore Indian Currency (IC).

In 2004, Telekom Malaysia along with Singapore Tech, Telemedia had signed a deal to buy 47.7 per cent in Idea Cellular for $390 million, but the deal did not go through due to government disapprovals. Similarly, it was outbid for Aircel by its rival, Malaysian firm, Maxis.