In a set back to Norwegian firm Telenor, the Company Law Board today allowed its estranged partner Unitech's plea for settling dispute over control and transfer of assets of their joint venture Uninor through arbitration at Singapore.
In a set back to Norwegian firm Telenor, the Company Law Board today allowed its estranged partner Unitech 's plea for settling dispute over control and transfer of assets of their joint venture Uninor through arbitration at Singapore. Observing that Telenor had gone "berserk" in filing its petition seeking ouster of its partner Unitech after Supreme Court cancelled telecom licences of their JV, CLB Chairman D R Deshmukh held that an arbitrator alone can decide if 'Share Subscription Agreement' and 'Share Holders Agreement' had been vitiated or not due to fraud.
The Supreme Court had in February held that the process of allocating 122 2G licenses including those to Uninor was 'arbitrary and unconstitutional' and cancelled all of them. Telenor, which bought stake in Uninor that was allocated 16 of those licences, sued Unitech for breach of warranties. The order drew sharp reactions with Telenor saying it will challenge the CLB judgement in higher courts while realty firm Unitech said the order uphold the right of minority shareholder. Telenor owns 67.25% in Uninor which has over four crore subscribers.
Realty firm Unitech holds the remaining 32.75% in the JV. "Telenor by claiming relief identical to relief claimed in its counter claim before the Arbitral Tribunal has left no room for any doubt that adjudication of the dispute arising must be left to the forum for resolution of dispute agreed by the parties i.e foreign arbitration," CLB said in its 38-page long order. "Parties (Telenor and Unitech) are referred to arbitration in accordance with the arbitration rules of Singapore International Arbitration Centre as contemplated under article 13 of the Share Subscription Agreement entered into between the parties," it added.
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Mkt at its peak, see good correction before Jan 31: Quantum