Essar Teleholdings Ltd (ETHL) Monday announced that it has exercised the option to buy out the stake of 3.43 percent held by Usha Martin Telematics in Hutchison Essar at Rs.2.67 billion.

With this purchase made Thursday, the Essar Group's stake in Hutchison Essar has increased from 26.99 to 30.42 percent, according to a company release.

"This acquisition is part of our decision to enhance our stake in the consolidated entity and also reflects the strong relationship between Essar and Hutch," said Vikash Saraf, CEO of Essar Teleholdings.

The purchase follows an agreement between Hutchison, Essar and Usha Martin Telematics, wherein Essar had the option to purchase 3.43 percent of Hutchison Essar at the original acquisition price for the Kolkata licence plus a carry cost.

Essar Teleholdings also recently acquired a 9.9 percent stake in BPL Mobile's Mumbai circle.