Mumbai:  Emirates Telecommunications Corporation (Etisalat) has acquired 45 per cent stake in Indian telecom start-up Swan Telecom for around $900 million, as the UAE-based telecom company bids to expand into higher-growth markets abroad.

Etisalat, the Gulf Arab region's second largest telecom firm, said it would acquire the 45 per cent stake in privately-held Swan through purchase of newly-issued shares.

The deal, which values Swan, at $2 billion, will give Etisalat a foothold in the world's second biggest telecom market.

Gulf telecom companies are pushing hard into emerging economies to escape saturated markets at home. Mobile phone penetration in the UAE, which has a population of 4.5 million, exceeds 150 per cent.

Etisalat had, in April, announced it could spend up to $4 billion on an acquisition or a licence in India as it sought to tap into opportunities in India.

Swan Telecom, promoted by the Dynamix Balwa Group, had recently bagged start-up GSM spectrum in 13 circles, including Delhi, and plans to roll out operations soon.

The Dynamix Balwa Group has interests in hospitality and real estate. Anil Ambani group company Reliance Communications was said to be holding 9.9 per cent stake in it at the time of applying for licence last year.

Etisalat, which operates in 16 countries across Asia, the Middle East and Africa has a presence in India, through its data services subsidiary Technologia in Bangalore.

Citigroup Global Markets Limited advised Etisalat on the deal while Deutsche Bank advised Swan.

Etisalat, which has been scouting for an Indian partner for quiet some time now, is reported to be also in talks with other players, including Spice Communication and Videocon-backed Datacom.