The Hindu Business Line : Vodafone's Hutch deal in order: Kamal Nath

New Delhi March 15 The Union Commerce Minister Mr Kamal Nath on Thursday said Vodafone's acquisition of controlling stake in Hutch-Essar appears to be in conformity with the law and Foreign Investment Promotion Board would take up the case in a few days.

"As it appears Vodafone's acquisition is in conformity with the law and FIPB will consider the case when it comes to it," Mr Kamal Nath said after he met the Vodafone CEO, Mr Arun Sarin, and the Essar Vice-Chairman, Mr Ravi Ruia.

Mr Nath said Vodafone's investments in India would bring synergies and technical expertise to the country.

Setting aside concerns relating to approvals from FIPB, Mr Sarin said that the proposal to acquire HTIL's stake was fully compliant with the laws and an approval from the Indian Government was expected in two to three weeks. He also said that Vodafone will have 52 per cent stake in Vodafone Essar and Essar will have 33 per cent stake while the balance 15 per cent will be with Mr Asim Ghosh, the CEO of Vodafone Essar, Mr Analjit Singh, Chairman of Max Group and IDFC.

"Vodafone has only 52 per cent stake in the company. It has long-term rights over the 15 per cent stake held by Mr Asim, Mr Analjit and IDFC, which may be exercised as and when the FDI laws of the country permit the company to acquire it," said Mr Sarin. "We are simply getting into the shoes of HTIL who has got all the necessary approvals. We are compliant with the FDI norms," added Mr Sarin.

Mr Ravi Ruia, Vice-Chairman, Essar Group, said that in case FIPB did not agree to the present equity structure, there was the option of bringing some part of its 22 per cent foreign holding routed through a Mauritius-based company to an Indian subsidiary.

On the MoU signed with Bharti for infrastructure sharing, Mr Sarin said that there was no legal binding on Vodafone to partner Bharti. "MoU is not a definitive agreement. It is not legally binding. It is just a statement of intent. We will take the proposal to the newly constituted board. We are open to share infrastructure with any operator who want to help us reach rural India," said Mr Sarin.

The MoU with Bharti was one of the contentious issues raised by Essar, which said that Vodafone had not consulted it before signing the agreement.

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