You must have probably heard the punchline – Partners in Progress. But welcome Hutch-Essar, they are partners in fight 🙂 Hutch-Essar have both indulged in few shady deals, to take the company public and make the promoters rich. Essar group had bought BPL Mobile for $1.1 Billion. Essar offered to transfer those companies under their JV with Hutch – Hutch-Essar. Due to intra-circle merger and regulatory hurdles, the going was not smooth for inclusion of BPL Mumbai into the JV. Hutch and Essar both had agreed to a deadline of July-31st, 2006 to get the approval or both the parties would have the right to cancel the deal and Essar pushed the button by calling off the merger.
Why was Essar planning to part ways from the JV just in the Mumbai circle ? Mumbai is a Metro circle and is a very lucrative market. BPL Mumbai has 12.97 lakh subscribers. Essar opposed the entry of Egyptian Telecom, Orascom on the board of Hutch-Essar. It was over ruled and Orascom got board representation when they got controlling stake in Hutchinson-Whampooa, parent of Hutch. The Hutch Essar cold war is now public and is in the court of law. Hopefully both the companies wake up before its too late in the rapidly changing world of telecom.
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