Tata Sons, the promoter of Tata Teleservices has received approval from the Competition Commission of India (CCI), to buy back 21.6% stake owned by Japan’s NTT Docomo. NTT Docomo and Tata Teleservices (TTSL) runs the Tata Docomo brand in India. After their joint venture, started posting continuous losses, TTSL was ordered to pay $1.17 (~Rs 7,538.89 crore) billion in damages to NTT by a London court in June last year. NTT paid Rs 12,924 crore in 2009 for an initial 26% stake in TTSL. https://twitter.com/CCI_India/status/867714405588361216 According to Tata’s proposal made to the CCI, it will “acquire equity shares of TTSL comprising 21.63% of the paid-up equity share capital” owned by “Docomo pursuant to certain consent terms entered into between Tata Sons and Docomo.” Tata did not expand about consent terms set between it and NTT Docomo in the proposal. The stake buy-back is a settlement for the lengthy legal battle between Tata Sons and NTT Docomo. The terms of the agreement between Tata and NTT Docomo had an option for the acquirer (NTT Docomo) to request a suitable buyer for at least 50% of the acquired price, in case the joint venture turns non-profitable. Tata, however, ran into trouble with RBI regulations over foreign exchange trade when it tried to settle ts payment. RBI told the HC in March that Tata’s payout of $1.17 billion in damages to the Japanese telco cannot be approved, and is illegal since it involves the transfer of shares to a foreign company. However, Tata used the CCI route to…
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