2G spectrum license issue: Etisalat says it never controlled Indian telecom business

Telecom Lead India: UAE-based Etisalat said it never
controlled its Indian telecom business due to several regulatory issues.


Etisalat said the company never obtained control of
Etsialat DB (EDB) because authorities in India did not permit it to pay control
premium to its Indian partner Majestic Infracon (MIPL) on alleged credibility
concerns of its promotor Shahid Balwa.


MIPL owns around 45.73 percent of Etisalat DB, while
Etisalat holds around 44.7 percent of Etislat DB.

“A control premium was not paid to Majestic/Balwa as Etisalat never
obtained control. The Indian Authorities did not permit it because they were
concerned about the standing of Balwa, including allegations of his links to
underworld figures,” Etisalat said.

Etisalat issues proceedings for winding up of Etisalat DB


Recently, Etisalat issued proceedings for the winding up
of Etisalat DB Telecom (EDB) in India in order to ensure proper and orderly end
to the business of EDB that is supervised by the Indian Courts. This follows
the February 2 supreme court order.


A number of recent events led to a complete breakdown in
the relationship between Etisalat and its Indian partners, Shahid Balwa and
Vinod Goenka, who face criminal charges of corruption associated with Swan’s
acquisition of its UAS licences. 


According to a MIPL statement, Etisalat had to pay
subscription money and control premium which is in excess of USD 400 million
and had not been paid to it.

The decision to shut down operations of EDB following the Supreme Court order
was taken by Etisalat nominees in the companies though MIPL directors had
opposed it.

“Thereafter, we were shocked to see Etisalat’s nominee directors
unilaterally deciding to pass an illegal resolution to immediately shut down
the operations of EDB without any prior notice to us despite the ILD, NLD and
ISP licenses still being valid,” MIPL said.

MIPL added that its nominee directors on the board of EDB resigned alleging
acts of omission and commission, deliberate incorrect recording of minutes and
blatantly false allegations of Etisalat.

Etisalat has alleged that whatever status of the company is due to resignation
of MIPL directors with no replacement besides the refusal to fund the JV
culminating in an expression of refusal by Majestic to play any further part in
the management of EDB, according to a PTI report.

MIPL on the other hand has held Etisalat responsible for the current status of

“Etisalat is and its representatives have, at all material times, been in
complete control including by virtue of their majority on the Board of EDB, and
hence responsible for EDB’s current state of affairs,” MIPL said.


Etisalat advises Mobile Number Portability to India telecom


Recently, Cheers Mobile, the brand of Etisalat DB, has
advised its customers to transfer their mobile number to another operator prior
to the scheduled suspension of Cheers Mobile services on 31/03/2012.

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