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Saturday, March 31, 2007
NEW DELHI: The Foreign Investment Promotion Board (FIPB) has deferred decision on Vodafone's acquisition of Hutch-Essar and sought more information from shareholders.
FIPB, after the meeting with the officials from Vodafone, sought information on the shareholding pattern and about the deal.
The Ministry of Overseas Affairs in the last meeting of FIPB had sought more time, adding that the matter would be considered depending upon responses from RBI as well as Ministries of Law, Home and External Affairs.
The debate on the deal came up after telecom giant Vodafone Group, won a majority stake in the Hong Kong-based Hutchison Telecommunications International Ltd (HTIL) for $11.1 billion.
According to the FDI guidelines, any foreign ownership in a domestic telecom firm could be up to 74 per cent.
RBI had raised apprehensions on the share holding pattern in the deal. The controversy relates to the 12.6 per cent stake jointly held by Asim Ghosh, CEO Hutch Essar and Analjit Singh. Vodafone, which has stuck the deal in Hutch Essar, has acquired 52 per cent stakes.
Essar’s Ruias owns 22 per cent FDI in its 33 per cent stake in the joint venture with the total FDI limit crossing 74 per cent.
However, the final decision on the controversy will end after Finance Minister P Chidambaram gives the final approval after the FIPB nod.
Chidambaram is currently in Hong Kong.
© CyberMedia News
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