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Shares in Vodafone Group PLC rose Monday as the market reacted positively to the weekend move by the world’s largest mobile telephone company to gain control of Hutchison Essar India Ltd. 

Buying into a rapidly growing market, Vodafone agreed to pay $11.1 billion for the 67 percent stake held by Hutchison Telecom International Ltd. 

Essar Group does not intend to exit Hutchison Essar, and will run the company together with Vodafone, Essar Group Vice Chairman Ravi Ruia told reporters after Vodafone CEO Arun Sarin met him in Mumbai. 

The terms for cooperation between Essar and Vodafone were laid out later in a statement from the Essar Group. “We will ensure that all of our shareholder rights, including under our shareholders’ agreement with Hutchison, are adhered to,” Essar Group said. 

This gives the Essar Group the right of first refusal to the proposed sale of its equity by Hutchison Telecommunications International (HTIL), according to informed sources. This right does not apply to the sale to Vodafone, Sarin said. But the Essar Group could tie down Vodafone in protracted litigation. It is more likely to use this clause in the shareholder agreement with HTIL to negotiate a more favorable shareholder agreement with Vodafone, the sources said. 

The Essar Group holds 33 percent in Hutchison Essar. Vodafone has said it would prefer Essar stayed as a partner, but if it chose to exit it would offer to buy its stake for the same price per share it is offering HTIL. 

Essar hasn’t entirely ruled out divesting from Hutchison Essar. Vodafone has approached Essar to discuss a possible partnership as regards Hutchison Essar, the Essar Group said in its statement. It will decide its future course of action in due course and in the best interests of the Essar group, it added 

 

 

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