THE VODAFONE THREAD

MUMBAI (AFX) - India's Essar Group has made a surprise offer to buy
Hutchison Telecom International Ltd's 67 pct stake in Hutchison-Essar in deal
which would value the venture at an estimated enterprise value of 17-18 bln usd,
said the Economic Times, citing bankers who met Hutchison officials to table the
offer.

Essar currently holds 33 pct in the venture.
The ET said that Morgan Stanley and Citibank are believed to have offered a
10 bln usd line of credit to Essar.

Apart from leaving other bidders like Vodafone Group PLC and Orascom-Qatar Telecom the choice to hike reported bids or withdraw, it said the Essar move also means that Hutchison cannot sell its stake to an Indian bidder - Reliance Communications - without giving Essar the right to match it, the report added.

It also said that Hutchison's response to the offer is not known, while Essar declined to comment.

During the last quarter, Hutchison-Essar had reported the highest growth in
overall revenues among GSM players, as well as being the only GSM provider in
India to record an increase in its average revenue per user (ARPU).

I suppose this is called a defensive play (verging on anti-trust elsewhere) - and particularly ups the price significantly.

Anyone have any views as to where this will go from here? Should Vodafone walk away or steam in quick?