Web Sify
Follow us on
Mail
Print

CLB stops Uninor asset sale

Source : BUSINESS_STANDARD
Last Updated: Thu, Aug 09, 2012 19:32 hrs

In a setback to Unitech Wireless, the Company Law Board (CLB) on Thursday stated telecom operator Uninor couldn’t auction its business assets.

Unitech Wireless, in which Norwegian company Telenor holds 67 per cent stake, operates in India under the Uninor brand. Last week, real estate company Unitech, a minority shareholder in Uninor, had moved the CLB against the auction of assets.

“I allow the application and injunct the respondent (Uninor) from taking any steps whatsoever in pursuance to the auction notice published on August 1 or similar notices that may have been published,” CLB Chairman D R Deshmukh said in his order on Thursday. He added the decision was final and would not be reviewed by CLB.

According to a PTI report, Uninor said it would move a higher court against the CLB order. “Since the CLB order has now been pronounced, we are able to comprehensively move our arguments towards Uninor’s assets auctions to higher courts,” read a company statement.

“As we have said earlier, Uninor will pursue every legal measure available that gives its employees, customers and business partners a chance to continue beyond the licence cancellation date,” it added.

On August 1, Uninor had invited potential bidders for the assets to send expressions of interest by August 6. However, on August 3, after hearing a petition filed by Telenor’s estranged Indian partner Unitech, CLB had stayed the August 1 notice and directed Uninor and other respondents to file their reply.

Uninor had then approached the Delhi High Court which, on August 6, modified the CLB stay order and allowed Uninor to receive expressions of interest from bidders till August 8. The petitioner had claimed the “transfer by way of auction is only a feeble attempt to malafidely colour the process of transfer of assets of Uninor as fair (though the fact remains that it is unfair, malafide and oppressive)”.

Unitech argued its three nominees on the Uninor board had opposed the auction and invoked their ‘veto rights’ in the shareholders agreement between the partners, through which they could reject any resolution critical to the future of the company.

Uninor, whose licences for 13 circles were cancelled by a Supreme Court order, can run operations till September 7.

Telenor and Unitech have been involved in a bitter battle for months, with the real estate company writing a letter to the Foreign Investment Promotion Board (FIPB) last week, opposing a Uninor application to raise Rs 1,200 crore through a rights issue. The issue, it argued, was a matter under arbitration. In its last meeting, FIPB had deferred the proposal.

The company’s valuation has also been a bone of contention. While earlier, Telenor had said the enterprise value of the entity was Rs 400 crore, Unitech had contested this, arguing it was worth Rs 12,000 crore. However, Deloitte and KPMG, mandated by Uninor for the auction, pegged the company’s value at Rs 4,190 crore.




blog comments powered by Disqus
most popular on facebook
talking point on sify finance