DoCoMo enters Indian market with $2.7 bln Tata deal

TOKYO/NEW DELHI (Reuters) - NTT DoCoMo Inc will pay $2.7 billion for a 26 percent stake in Tata Teleservices, giving Japan's top mobile operator a foothold in the world's fastest-growing major mobile market.

DoCoMo's deal with India's No. 6 mobile operator follows a $350 million investment in Bangladesh's No.3 cellphone carrier, as it speeds up its expansion beyond a mature home market, and adds to the record $63 billion of overseas acquisitions by Japanese firms this year.

But as DoCoMo expands, salt-to-software conglomerate Tata Group -- the parent of unlisted Tata Teleservices and the flagbearer for corporate India's recent overseas expansion -- has put its plans for acquisitions on hold due to the global credit crisis.

DoCoMo's bill for the 26 percent stake is almost equal to the $3 billion market value of Tata Tele's larger rival Idea Cellular.

It gives Tata Teleservices a valuation of $10.4 billion, more than the $9 billion market cap of No. 2 player Reliance Communications, which has almost double the user base of Tata Tele.

"This investment does not seek short-term returns but rather seeks long-term return through the growth of the Indian market as well as TTSL itself," DoCoMo chief executive Ryuji Yamada told reporters in Tokyo.

"We consider the investment in TTSL as one of our most important deals in our overseas strategy."