New Delhi: Unitech, real estate major has filed a petition before the Company Law Board (CLB) against its partner Telenor and alleged that the cellular firm is involved in mismanagement of the joint venture company Uninor.
Uninor is a JV between Norway’s telecom major Telenor, which owns 67.25% stake and Unitech, which holds the rest 32.75%.
Unitech’s petition will come up for hearing on Thursday, according to CLB officials. Both the partners are also fighting a court battle over mode of financing of the company’s expansion plan. While Unitech is insisting on debt route to fund the expansion plan, Telenor wants to take the equity route.
“There was an unsuccessful attempt earlier to block the rights issue through a legal process that went up to the Supreme Court of India. As we have done earlier, we will present the facts in this new legal initiative taken by Unitech,” A Telenor statement said.
In its application to CLB, Unitech said to enforce a rights issue on Unitech, Telenor and its key executives have made the Uninor’s board to approve and adopt a 10-year business plan, which is “outright unilateral, malafide, self-serving, premature and aimed at artificially depressing the valuation of the company”.
Unitech also submitted that the business plan projects a “disastrous future” for the company.
“It takes the business to the brink,” it further said. In the business plan, Unitech alleged that the rate of return of Uninor is projected in the negative (-11% ). The petition said, “The business plan by Telenor is not only contrary to the annual business plan adopted by the board on January 4, 2011, but is also highly prejudicial to the interests of the company and that of the petitioners,” it said.
The petition also alleged that Uninor, whose management is controlled by Telenor, failed to fulfill the business obligation such as launch of services in various circles.
Telenor said the Uninor board, having followed prescribed processes, has asked its owners to invest more in the company in the absence of bank loans. However, Unitech alleged that Uninor management did not avail the Rs 9,000 crore loan from SBI when it was available.
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