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Telecoms ministry obtains stay order on Idea-Spice deal
The telecoms ministry has obtained an order to stay the takeover of Spice Communications by the country's sixth-largest mobile carrier Idea Cellular, two sources said on Friday, but Idea said it will oppose the move.
The telecoms ministry has obtained an order to stay the takeover of Spice Communications by the country's sixth-largest mobile carrier Idea Cellular , two sources said on Friday, but Idea said it will oppose the move.
Idea said in a statement on Friday the telecoms ministry had obtained "an ex parte order on a merger approved over a year ago," but did not give further details.
A senior official in the telecoms ministry and another source with knowledge of the development confirmed that the telecoms ministry had obtained a stay order from the Delhi High Court against Idea's takeover of Spice Communications.
Both did not provide further details.
In 2008, Idea agreed to buy smaller rival Spice in a three-way deal that also gave Malaysia's Axiata about a fifth of Idea.
Idea said in a statement it had submitted detailed plans to the telecoms ministry when it announced the deal in June 2008 and had updated the ministry at "every step" of the process over the last three years.
It also said it had "unconditionally offered" to surrender overlapping licences to comply with rules, as both Idea and Spice held separate licences for same operating zones.
Under Indian rules, no firm is allowed to own 10% or more in two competing companies operating in a zone.
"Apparently, to cover for its inefficiencies, the (telecoms ministry) is now indulging in duplicity and muscle flexing. Idea will resist and not be bullied," Idea said in a statement.
