RPG Mobile holds 51 per cent in RPG Cellcom, while Vodafone holds the balance 49 per cent. The payment was completed in a single tranche and is valued at around $100 million. Rabo India were the advisors to both the RPG group and Vodafone on the deal. RPG Cellcom provides cellular mobile telephony services in the state of Madhya Pradesh. The company currently has a base of over 20,000 subscribers.

The Madhya Pradesh circle is important, from the point of view that it is right in the middle of the country and borders seven telecom circles.

Industry observers feel that the circle is vital to the Birla AT&T and Tata Cellular combine, as it has cellular licenses in Maharashtra, Andhra Pradesh and Gujarat.

The circle is also vital, with the possibility of national long distance traffic being diverted through it. It may be mentioned that the RPG group has also put 49 per cent of the Chennai cellular license on the block. The deal has, however, run into valuation problems, with the Centre coming out with the announcement of the fourth cellular licence.

Industry sources told The Financial Express that the number of bidders for the stake had now boiled down to three contenders.

The RPG group owns 68 per cent in RPG Cellular, while Air Touch Vodafone and Skycell Mauritius hold around 21 per cent and 11 per cent, respectively. The RPG group is off-loading 17 per cent of its stake, while Air Touch Vodafone and Skycell are off-loading their full stake.

The RPG group's cellular licence in Chennai is considered lucrative, as the company has very good profitability, with profits of more than Rs 1 crore per month, according to industry analysts.