New Delhi: Intensifying row with its minority stakeholder, Norway's Telenor-controlled Indian venture Uninor on Wednesday put on auction its entire telecom business for a minimum of Rs 4,000 crore, a move opposed strongly by Unitech.
The Nordic countries' biggest phone operator wants to scrap the joint venture with Unitech and migrate its business to a new company to seek fresh operating licences as the JV's 22 telecom permits were among the 122 quashed by the Supreme Court in February.
Telenor, which holds 67.25 per cent in Uninor, is keen to acquire the business to protect its Rs 14,000 crore investment and retain 45 million customers. It will pay Rs 4,190 crore in case no one else turns up in the auction, Unitech Wireless Pvt Ltd that operates under the Uninor brand, said in the auction notice. Unitech hold 32.75 per cent stake in Uninor.
"The proposed auction of Uninor assets is nothing but a circuitous way for Telenor to transfer these assets to another one of its own entities," Unitech said in a statement.
"Instead of a direct transfer an auction is being proposed to provide it a garb of legitimacy, knowing fully well that no new telco will value the assets before acquiring spectrum".
According to Uninor, it wants to auction the company's business, including its assets while it is a going concern before the September 7 deadline set by the apex court for winding up of operations of all the firms whose licences had been cancelled.
"Unitech nominees had vetoed the move to auction assets in the board meeting of Uninor. Courts in India have already held that the Articles of Uninor cannot be disregarded," Unitech said in a statement indicating that the company may initiate legal action if Uninor was to go ahead with the sale.
"Whether the Shareholder's agreement can be unilaterally rescinded by Telenor is also a subject matter of arbitration between the shareholders and any decision by Telenor otherwise is prejudicing and circumventing this entire process," it said.
Uninor said auction will allow the company to generate the maximum possible returns for its creditors and secure the future of Uninor's customers, employees and business partners in the hands of new ownership.
"Telenor Asia Pte Ltd, majority shareholder of the company, has indicated its willingness to participate through an Indian affiliate entity in the auction of the business of the company," Uninor statement said.
Uninor said "an open auction will also remove any dispute around the real valuation of the Uninor business".
Valuation of Uninor has been a major bone of contention between Telenor and Unitech. Unitech is willing to exit Uninor but feels the valuation put by Telenor was a fraction of Uninor's real worth.
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