"Now that Sterling has made its offer, we would work out the modalities for a counter offer. We may price it at Rs 95 only as we already have close to 90 per cent stake in the company, including the 9 per cent we bought from Sterling. This will be transferred to us only once its open offer is through," said a top Bharti group source.

Even though Sterling is making the offer for 20 per cent, only a little over 11 per cent of the company's stake is with the public.

Sterling's offer saga for Bharti Telecom began in late 1996, when the company picked up a stake in Bharti Telecom and decided to make an open offer.

The bid, which was seen as a hostile one by the promoters of Bharti, wassuccessfully blocked and Sterling gave up its plans to pick up a stake in the company.

However, since it had already announced its offer, Sebi did not allow a withdrawal. Sivasankaran contested the case with Sebi first and then the appellate authority and both fora rejected his exemption from open offer plea.

In the meantime, Sterling sold its 9 per cent holding to Bharti itself and Bharti group companies followed up this purchase with an open offer to the public at Rs 95 per share. They managed to take their holding up to 80 per cent (excluding the 9 per cent which they had earlier bought from Sterling).

In its public announcement on Wednesday, Sterling has made it clear that it has an agreement with the two Bharti group companies to sell its 9 per cent holding in Bharti Telecom and would do so as soon as the open offer formalities are completed.

With the addition of Sterling's 9 per cent stake, the promoter holding in Bharti Telecom will go up to 88.58 per cent, marginally less than the 90 per centstake required to delist the company. In fact, sources said that the counter offer was aimed at picking up the required 1.5 per cent stake so that Bharti Telecom can be delisted.

Sterling's offer will open on October 26 and close on November 24. The specified date has been fixed at September 30. However, shareholders who have not been able to register themselves by the specified date can send the details of their holding by November 5.

Sterling has deposited Rs 8.02 crore in an escrow account with Deutsche Bank. The balance Rs 24.08 crore required to pick up the 20 per cent stake in the company would be met by the company out of its own source of funds which will be stated in the letter of offer.

Run-up to the open offer