'Not bound by RIL's alleged RoFR in RCOM' | business | Hindustan Times
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'Not bound by RIL's alleged RoFR in RCOM'

business Updated: Jul 19, 2008 22:42 IST

A day after the collapse of deal between South Africa's MTN and RCOM, an Anil Ambani company on saturday charged Mukesh-led RIL with causing substantial harm to it as a majority shareholder in the Indian telecom entity and asserted its rights to claim damages.

AAA Communications, a private company of Anil Ambani that holds 63.38 per cent equity in RCOM, on Saturday wrote to RIL claiming it was "free to and shall deal with RCOM shares as it deems fit."

It claimed that it was not a party to any "alleged non- compete agreement dated January 12, 2006" and hence was not covered by any alleged rights of first refusal to RIL.

An RCOM spokesperson, however, declined to comment when asked about the non-compete agreement, citing which RIL had initiated the arbitration process against RCOM by nominating a former Supreme Court judge Justice BP Jeevan Reddy as an arbitrator on July 17.

A spokesperson of RIL, which had thrown the spanner in negotiations between RCOM and MTN, which could have possibly created a US$ 70-billion telecom entity, by asserting its right of first refusal on majority stake in RCOM, declined to comment immediately on the letter from Anil Ambani firm.

The Anil Ambani firm termed RIL's action as "uncalled for, offensive and clearly motivated" and said RIL's "mala fide interference caused significant harm to AAA Com as a substantial RCOM shareholder".

"AAA Com reserves right to claim direct and consequential damages from RIL," the spokesperson said.

The Anil Ambani firm's claim that it was free to deal with RCOM shares in whatever way it deemed fit is also seen as a signal that it was ready to start negotiations for any deal with any entity, including MTN.

The statement from the Anil Ambani firm's spokesperson comes close after RCOM and MTN calling off their negotiations citing "legal and regulatory hurdles".

"The two sides were unable to conclude the transaction due to certain regulatory issues," RCOM said in a statement yesterday night, ahead of the July 21 expiry of the extended agreement for exclusive talks with MTN.