How the Vodafone case impacts other M&A deals

The Vodafone judgement will have a direct bearing on other M&A deals which have been  under I-T dept scanner.

Various judgements on several M&A deals pending in courts across India:

• Idea Cellular-AT&T $ 150 mn deal pending in Bombay HC
• GE-Genpact $ 500 mn deal pending in Delhi HC
• Mitsui-Vedanta $981 mn deal in Sesa Goa pending in Goa HC
• Sabmiller-Fosters 2006 deal pending in Bombay HC
• Sanofi Aventis-Shantha Biotech $770 mn deal pending in Bombay HC

Case files:

GE-GENPACT

General Electric (GE) sold majority stake in Genpact, India's largest business process outsourcing company, in 2004. The buyers were US-based private equity companies, General Atlantic and Oak Hill Partners. They paid $500 million for 60% stake in the Indian company. The transaction was completed overseas, and may have been taxed in the US. The matter is
pending before the Delhi High Court.

MITSUI CO

The Japanese Company had sold 51% interest in mining company Sesa Goa to UK-based Vedanta group for $981 million in April 2007. The deal was routed through Finsider International, a company incorporated in the UK, which held the Sesa Goa shares. Vedanta bought 100% in Finsider. The dispute is pending before the Goa High Court.

IDEA CELLULAR ((Currently in SC))

The Idea Cellular stake sale by US telecom operator AT&T to the Tata group have similarities to the Vodafone Essar case. The Tata Group, which later exited Idea Cellular, had bought a Mauritian subsidiary of AT&T that held 16.5% in Idea, for $150 million. The case is pending before the Bombay High Court.

SABMILLER-FOSTER ((Currently in Bombay HC))

The world's second-largest brewer, SABMiller, had acquired 100% shares in Foster's India, the Indian arm of Foster's Australia, in 2006. The matter is pending before a Pune Court. In a separate case, Foster's Australia had approached India's Authority for Advance Ruling (AAR), on the question of whether sale of brand and patent attracts tax in India. AAR answered the question in the affirmative.

SANOFI AVENTIS-SHANTA BIOTECH

French drugmaker Sanofi Aventis had bought majority stake in Indian vaccine company Shantha Biotech in 2009 for around $770 million. The deal was through an SPV created by Merieux Alliance that held 90% in the Indian company. The tax department says Sanofi is liable to pay withholding tax on the gains made by Merieux. The matter is pending before Bombay High Court.