Batelco to sell S Tel stake for $174.5 mn
The apex court, however, gave the bank and the named officials eight weeks to prepare their defense in the criminal conspiracy case, and said they were free to apply for bail.
The Supreme Court verdict cancelling 122 telecom licenses claimed its first casualty as Bahrain-based Batelco Wednesday announced its exit from India, selling its stake in mobile firm S Tel.
S Tel, which had acquired licences to operate in six circles including Odisha, Bihar and Himachal Pradesh, is a joint venture between Batelco and Sky City Foundation, owned by former Aircel promoter and serial entrepreneur C Sivasankaran.
BMIC Limited, a 100 percent Batelco-owned subsidiary company, had acquired the stake in STel via two transactions in May and June 2009 for $174.5 million.
"Batelco Group, the Middle Eastern regional telecommunications operator of reference with operations across seven countries, today (Wednesday) announced its agreement for the sale of its shareholding in STel, a mobile operator in India," Batelco said in a statement.
"This is a part of an earlier understanding with its Indian partner to exit given the circumstances surrounding the 2G probe in India over the past 12 months," it added.
The agreed time frame for completion of the stake sale is the end of October 2012.
The Supreme Court has given all the affected firms four months time to shut shop and asked the government auction the free the spectrum.
S Tel in an official statement said, "The telecom sector particularly for the new operators over the last two years had become like a badly planned hurdle race. Batelco was very uneasy in India and expressed their wish to sell their stake."
"This is true even as per their stock exchange disclosures as early as June 2011 when they had already classified S Tel shares as 'assets for sale' in their books. Subsequently, Siva Group and Batelco discussed the way forward and Batelco agreed to sell their shares and exit. On or around October 2011, the Siva Group offered to purchase the shares and also sought a year's time to consummate this transaction. The one year time was to look for an alternate investor or if everything goes well, Siva Group itself to repurchase the BMIC stake in S Tel."
"In the present circumstances, we are discussing the modalities with our partner and we hope we will overcome the temporary setback in a confident and successful manner. These are early days to speak about the transaction which was entered into before the SC judgment. At the moment we are looking at options before us including filing a review petition before the Supreme Court. The SC has granted four months time and any clarity would be arrived only around June 2012," S Tel's statement concludes.
Another telecom operator which has also hinted at exiting India business, Uninor's parent firm Telenor has said it would fight for its rights and proposed restricting older players from the 2G auction whenever the government conducts it.
Uninor's case has also been taken up at a diplomatic level by Norway. The country's IT minister Tuesday met Communications Minister Kapil Sibal.
Even Russia's Communications Minister Igor Shchyogolev is reported to visit India to express the country's concern over its investments in the Indian firm, Sistema Shyam Teleservices (SSTL).
SSTL, a joint venture between Russia's Sistema and India's Shyam Group, which provides its services under the MTS brand name, has also said that it reserves the right to protect its interests by using all available judicial remedies and was mulling the option of filing a review petition in the apex court.
Sistema holds a 56.68 percent stake in the venture, while the Russian government holds 17.14 percent and the Shyam Group of India has another 23.98 percent. The remaining 2.2 is publicly owned.
Another foreign operator, which has also been affected by the Supreme Court's ruling, is Dubai's Etisalat. The company protested the apex court's decision saying it had no knowledge of what occurred in the licence application process for Swan, which was conducted by the Indian promoters and their associates.
According to Etisalat, the promoters subsequently marketed the Swan investment opportunity to Etisalat through an international investment bank.