The crucial meeting of the Foreign Investment Promotion Board to consider the Rs 10,141-crore proposal of UK telecom giant Vodafone to acquire the remaining stake in its Indian arm scheduled for today has been postponed to Monday.
“...the 199th meeting of the FIPB, which was scheduled to be held on Friday, December 6, 2013 ... has been postponed and will now be held on Monday, December 9, 2013...,” the Finance Ministry said.
The Vodafone proposal along with 10 others would now be taken up on Monday. However, no reason was assigned for postponement of the meeting.
The board is headed by Economic Affairs Secretary Arvind Mayaram.
CGP India Investments Ltd, an indirect Mauritian unit of Vodafone International Holdings BV, is seeking approval to buy the entire stake held by minority shareholders in Vodafone India Ltd. Vodafone holds a 64.38 per cent stake in the Indian unit.
The proposal was earlier listed on the agenda of FIPB meeting on November 13 but could not taken up for want of comments from various ministries.
Opinions were sought from the Department of Telecom, Department of Industrial Policy and Promotion, Ministry of Home Affairs, Ministry of External Affairs and the Department of Revenue.
Vodafone’s minority investors include billionaire industrialist Ajay Piramal, who holds an 11 per cent stake in India’s second-largest telecom company by subscribers. The remaining stake is with undisclosed shareholders. Analjit Singh, Vodafone India’s non-executive Chairman, is understood to be among them.
“The total inflow of foreign investment into India as a result of the proposed transactions will be approximately Rs 10,141 crore. Following the completion of these transactions, Vodafone will also consider providing additional funding to VIL by subscribing to equity shares of VIL,” Vodafone had said.
Vodafone had entered India in 2007 by buying Hutchison Whampoa’s stake in Hutchison-Essar Ltd in a $11 billion deal.
The company was slapped with a tax liability of over Rs 11,200 crore, along with interest, for the 2007 acquisition and is in talks with the government to resolve the issue.
Other proposals scheduled to be taken up on Monday, include that of Jubilant Aeronautics and Malca Amit Global Ltd, Hong Kong.