MUMBAI: Reliance Communications’ shares rose 2.2% to Rs 191.25 on Monday on hopes that its stake sale to Dubai-based Etisalat will be completed soon. Reliance Communications, or RCOM, has been in talks with Etisalat for nearly a month.

But to invest in RCOM, Etisalat must first exit Swan Telecom, part of a set of new mobile service providers, as Indian norms stipulate that an investor cannot hold 10% or more in two telecom operators.

Etisalat holds 45% in Swan and is awaiting Foreign Investment Bureau approval to raise its stake to over 50%. It invested $900 million in Swan just after it received second generation, or 2G, wireless bandwidth for telecom operations in 15 service areas.Swan is yet to start operations. It is possible that Swan will be dissolved and its licence revoked if Etisalat exits, a person familiar with developments told ET. Swan’s managing director, Shahid Balwa said talk of Etisalat’s exit is “bogus”.

But the person said Etisalat has in-principle agreed to mostly write-off its investment in Swan and is awaiting a final deal to be worked out with RCOM. The decision may be taken in the first week of August when the Dubai-based company’s board is scheduled to meet. The RCOM spokesman said he had no comment on a deal with Etisalat.