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Rediff News  All News  » Business » Vodafone gets ready for FIPB meet

Vodafone gets ready for FIPB meet

March 28, 2007 14:38 IST

Ahead of Thursday's Foreign Investment Promotion Council meeting that would take up sale of stake in Hutch-Essar to Vodafone, the UK company's director Mathew Kirk met telecom secretary Dinesh Mathur on Wednesday.

Although sources in DoT said Kirk, in-charge of external relations, discussed telecom licensing issues with Mathur, it is believed that the Vodafone director raised the FIPB issue with the secretary.

The FIPB will look into the veracity of allegations of breach of FDI norms in Hutch-Essar, whose minority shareholders Asim Ghosh and Analjit Singh along with Vodafone and Hutchison Telecom would be making brief presentations before the board on Thursday.

Ghosh and Singh jointly hold about 12.26 per cent stake, which is in the centre of a controversy on whether it actually belongs to them or HTIL (or now Vodafone).

The two shareholders, along with Vodafone and HTIL, have been asked by FIPB to clarify their position on March 29, sources said, adding that all the four parties have been given 5-10 minutes each to make their case.

FIPB chairman Ashok Jha has sought Mathur's presence in Thursday's meet. HTIL would be represented by legal firm Amarchand Mangal Das and Vodafone by Kirk.

Official sources, when contacted, said that FIPB had also sought home ministry's opinion on the matter.

The controversy relates to allegation that Vodafone, which acquired 52 per cent controlling stake in Hutch-Essar from HTIL, also owns the 12.6 per cent stake held by Ghosh and Singh, but the two have denied the charge.

Since Essar owns 22 per cent FDI in its 33 per cent stake in the joint venture, the total FDI limit would cross the 74 per cent limit and this is being examined by the FIPB.
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