The Ministry of Corporate Affairs (MCA) has cleared Indian mobile Reliance Communications (RCom) of holding more than 9.9% in Etisalat DB (formerly known as Swan Telecom) in 2008, the Economic Times reported today.
Under Indian shareholding laws, a…
The Ministry of Corporate Affairs (MCA) has cleared Indian mobile Reliance Communications (RCom) of holding more than 9.9% in Etisalat DB (formerly known as Swan Telecom) in 2008, the Economic Times reported today.
Under Indian shareholding laws, a telecom operator is prevented from holding more than 10% in a competitor. The MCA’s investigation results come in the wake of the 2G scam scandal in the country.
The report explained that had RCom owned 10% or more of Etisalat DB, the latter would have been ineligible to get 2G licences in 2008.
The company has nonetheless been recently asked to justify why its licences should not be cancelled, along with several other mobile operators.
Etisalat DB is a joint venture between UAE-based Etisalat, which owns a 45% stake in the company, and India-based DB Reality, which holds most of the remaining shares. The Economic Times explains that RCom sold its preference shares in Etisalat DB in October 2007.
