Hutch-Essar deal closure by July: Vodafone

Undeterred by the controversy over foreign holding in Hutch-Essar, Vodafone today exuded confidence of closing the deal for acquiring majority stake in the venture by July this year.

"We won't be speculating on the timetable, but we do expect to close (the deal) in the second quarter," a Vodafone spokesperson told PTI from London when asked about delay in getting clearance from the Foreign Investment Promotion Board (FIPB).

FIPB is meeting tomorrow to consider Vodafone acquisition of Hutchison Telecom's stake in Hutch-Essar, but the board is yet to receive a response from the RBI as well as ministries of law, home, external affairs and overseas affairs.

Vodafone director meets telecom secretary

Ahead of tomorrow's Foreign Investment Promotion Board (FIPB) meeting that would take up sale of stake in Hutch-Essar to Vodafone, the UK company's director Mathew Kirk today met telecom secretary Dinesh Mathur.

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.

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 tomorrow.

Ghosh and Singh jointly hold about 12.26% 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 tomorrow'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% controlling stake in Hutch-Essar from HTIL, also owns the 12.6% stake held by Ghosh and Singh, but the two have denied the charge.

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