In a breather for Unitech Wireless, the Delhi High Court on Monday allowed the company to accept ‘expressions of interest’ from bidders interested in buying the company’s business assets.
Norwegian telecom company Telenor holds 67 per cent stake in Unitech Wireless.
“I am modifying the order of the Company Law Board (CLB) to the extent that the date to receive the EoI (the intention to purchase) from bidders is extended till August 8,” justice Indermeet Kaur said, adding that CLB would decide the petition on merit.
The court was hearing a petition by Unitech Wireless against a CLB order that stayed the auction of the company’s business to the highest bidder at a base price of Rs 4,000 crore. Telenor’s estranged partner Unitech had filed a petition in the CLB, seeking a stay on the auction process.
A Uninor statement read: “With on Monday’s decision of the high court of Delhi, Uninor is able to proceed towards the auction and seek expressions of interest, as planned. As we had said earlier, this auction is the only available route to ensure Uninor’s customers, employees and business partners have a chance to continue beyond the licence cancellation date.” It added securing the future of its creditors, employees and customers would continue to be the company’s priority, and welcomed the court’s decision.
CLB Chairman D R Deshmukh had stayed the August 1 auction and listed the matter for hearing on August 8.
In its public notice after a meeting of the board, Unitech Wireless had fixed a deadline of August 6 for interested parties to come up with expressions of interest to bid for the business.
Telenor had stated it would be interested in bidding for the auction and would do so through a new Indian partner, not Unitech. The petitioner had claimed the “transfer by way of auction is only a feeble attempt to malafidely colour the process of transfer of Uninor assets as fair (though the fact remains it is unfair, malafide and oppressive).”
Unitech has argued its three nominees in the board had opposed the move to auction, invoking their “veto rights” in the shareholders’ agreement between the two partners. Through this, they could reject any resolution critical to the future of the company. The company, whose licences were cancelled in 13 circles by a Supreme Court order, can continue to run its operations only till September 7.
Telenor and Unitech have been involved in a bitter battle, with the real estate company writing a letter to the Foreign Investment Promotion Board (FIPB) last week, opposing a Uninor application to raise Rs 1,200 crore through a rights issue. It alleged the issue was a matter under arbitration. In its last meeting, FIPB had deferred the matter.
The company’s valuation has also been a bone of contention between the two partners. While earlier, Telenor had stated the enterprise value of the entity was Rs 400 crore, Unitech had said it was worth Rs 12,000 crore. The new valuation of the business, undertaken by Deloitte and KPMG and mandated by Uninor, pegs it at Rs 4,190 crore.