United-Arab Emirates-based operator Etisalat is looking for a way to get a piece of the action in India, saying Wednesday that it held talks to acquire a stake in regional mobile provider Spice Telecom .

"India is a very attractive market for Etisalat, and we are studying different market entry strategies to determine the most appropriate fit," chairman Mohammad Omran said in a statement. "Etisalat has entered into direct meetings with various entities, amongst them Spice Communications, although nothing has been finalized at this stage."

It's also evaluating the possibility of picking up a new license in India, although executives have noted that the lack of available spectrum is a hurdle to entering the market.

Spice operates in the regions of Karnataka and Punjab, and was awarded licenses for four more service areas -- New Delhi, Andhra Pradesh, Maharashtra, and Haryana in January. (See A Guide to India's Telecom Operators.) It had 4.08 million subscribers at the end of February. (See Indian Mobile Carriers Add 8.4M Subs.)

The operator is 40.8 percent owned by chairman Bhupendra Kumar Modi's family investment firm Modi Wellvest and 39.2 percent owned by Telekom Malaysia Bhd. Under their agreement, both parties have the right of first refusal on any stake sale. The rest of the company's shareholding is divided between public and institutional investors. (See India's Spice Sets IPO Date and Spice Makes Tasty Market Debut.)

As one of India's smaller operators, Spice has frequently been the subject of M&A talk, including speculation over a possible merger with Idea Cellular Ltd. , another regional operator. (See Spice Mulls Hot Merger IDEA.)

Shares in Spice jumped 10.24 percent to 33.90 Indian rupees on the Bombay Stock Exchange Wednesday. The value of the stock has surged 31.65 percent over the past week.

Etisalat is one of several former monopolies in the Middle East that are branching out internationally as their home markets are deregulated. (See Who Does What: Middle East Carriers.) Etisalat has investments in 15 countries outside the U.A.E., most recently acquiring a 15.97 percent stake in Indonesia's PT Excelcomindo Pratama last December. (See Etisalat Buys Excelcomindo Stake.)

Turning its attention to India, Etisalat last month established a software unit in Bangalore. Etisalat Software Solutions will operate under the brand Technologia, providing software development, mobile applications, and IT services to Etisalat and other operators in the region.

The operator announced yesterday that it will work with Mashreqbank, Tata Communications Ltd. (formerly VSNL), IDEA Cellular, and HSBC India to roll out a mobile money transfer service from the U.A.E. to India following the completion of its pilot phase. The service is set for a commercial launch in June.

Etisalat's shares closed 2.04 percent higher on the Abu Dhabi stock exchange at 20.60 today.

— Nicole Willing, Reporter, Light Reading