The market reacts to Vodafone's purchase of Hutchison Essar

Vodafone values Hutchison Essar at $18.8 billion. Vodafone investors cheer but analysts are more cautious and telecom shares across Asia feel a trickle-down effect.

When the deal was announced early Monday morning it almost seemed anti-climatic. Given the media frenzy leading up to the announcement, VodafoneƆs acquisition of a controlling interest in Hutchison Essar, India's fourth-largest mobile-phone company, was devoid of much controversy.

The deal implies an enterprise value of $18.8 billion for Hutchison Essar, squarely in the range of the $18-$20 billion that was being estimated. Hutchison will assume $1.96 billion of net debt - $1.33 billion at the Hutchison Essar level and...

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