The US-based private equity firm Providence Equity Partners has infused an investment of around $640 million (Rs 2,560 crore) for picking up 20% stake in Idea’s wholly-owned subsidiary, Aditya Birla Telecom (ABTL), a wireless communications company in India.

With this acquisition, Providence`s total investment in Idea Cellular increases to USD 1.04 billion, which is the largest private equity investment in an Indian telecom service provider.

Earlier, Providence had invested $400 million in Idea in a pre-IPO placement.

According to the company, the fund will be used to carry out the ABTL's network roll out, ongoing expansion programmes and for future use.

ABTL owns Idea’s 16% stake in Indus Towers Ltd, the tower business joint venture with Bharti and Vodafone Essar Ltd.

ABTL also holds license for Bihar and Jharkhand circles. The company is set to launch its GSM service in these two circles within the next three to four months.

The deal between Providence and ABTL, which is subjected to regulatory approvals, is expected to be completed by August 2008.

DSP Merrill Lynch was the sole advisor to Idea on the deal.