Tussle between Telenor and Unitech deepens

New Delhi: The tussle between Telenor and Unitech has gained a new dimension with both companies approaching the Company Law Board (CLB) seeking to restrain each other's moves.

The differences intensified after the Supreme Court cancelled 122 telecom licences last month given to nine companies in January 2008.

The order was in connection with irregularities in the issue of 2G spectrum and licences. The companies included Uninor, STel Pvt Ltd and Dynamix Balwas (Etisalat DB).

The joint venture's 22 telecom licences were among the 122 that were revoked.

Norway-based telecommunications company Telenor owns 67.25 per cent of the joint venture, which operates under the Uninor brand, and India's real estate company Unitech holds the remainder.

Telenor, which had bought into the JV after the licences were granted, accused Unitech of "fraud and misrepresentation" and said it would form a new company with a new partner.

Severing its ties, Telenor said it had approached the CLB to prevent any "wrongful obstruction" by Unitech of its effort to secure its Indian investments. Telenor plans to manage its Indian operations and bid in the new auction of 2G spectrum.

But a Unitech official said, "Telenor has no legal standing to annul the JV arbitrarily and create a new company to bid for auctions."

"Telenor cannot transfer or sell Uninor's assets without the consent of Unitech. Either party cannot terminate the shareholders agreement unilaterally," he added.