Mumbai, Sept. 14: The arbitration panel hearing the dispute over BPL
Mobile ownership between BPL Mobile and Vodafone-Essar has rejected Vodafone's
claim for keeping the the advance paid to Essar and other shareholders for the
acquisition of BPL in an escrow account. This is a setback to Vodafone, which
has neither got BPL Mobile, nor the advance money it has paid for the telecom
company.
Vodafone had paid over Rs 1,600 crore two years ago for buying BPL Mobile
as per the terms of agreement between the two parties after Vodafone took over
Hutch Essar. According to the agreement, Vodafone was to submit an approval of
the department of communications for the purchase of BPL Mobile.
Since, it was not able to get the approval within a stipulated time, the
shareholder of BPL rejected the merger of BPL with Vodafone. That's when the
two parties decided to go in for arbitration. Vodafone had put two pleas before
the arbitration panel.
One was that there should be a status quo in the BPL Mobile's ownership
and that the money that was paid to Essar should be put in an escrow account.
At the hearing on September 5, 2008, the the judge said that the status quo in
the ownership of BPL Mobile should remain and he rejected the plea for the
escrow account.
BPL had during the course of the arbitration had disclosed that it had
sold shares of BPL Mobile to a Mauritius-based company Gypsy Rover for around
Rs 320 crore. The ownership pattern of BPL Mobile was as follows at the time of
the proposed acquisition of BPL by Vodafone: The Ruias of Essar owned 9.9 per
cent stake in BPL while Capital Global, a Mumbai-based investment company, held
16.1 per cent. BPL Communications held the remaining 74 per cent. In October
last year BPL sold 17 per cent of the BPL shares to Mauritius-based Gypsy Rover
in two 2007 Tranches, the second one being in July this year.
deccan.com
Experience is the teacher of all things.
- Julius Caesar
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