FIR details how Marans scripted the Aircel-Maxis agreement

Exactly six years ago, in October 2005, C Sivasankaran, entrepreneur and the then owner of telecom company Aircel, received a call from one Ralph Marshall, telling him how all his problems were set to be solved. Marshall, director of Malaysian conglomerate Maxis, assured Siva he had got a go-ahead from the Maran brothers for taking over Aircel. The conference call was arranged by Standard Chartered Bank, which was engaged by Maxis to broker a deal with Aircel.

The following month, on November 12, 2005, Siva had a meeting with Kalanithi Maran, media tycoon and brother of the then telecom minister Dayanidhi Maran. Kalanithi instructed Siva to work out a deal with Maxis. Not just that, he also alerted him that he would receive a call from his brother on the matter. Dayanidhi called Siva later in the day and assured him that the deal would be cleared.

 

Things had not moved at this pace for Siva for long. In his telecom business, at least three applications were pending since March-April 2004 and four since March 2005.

All this and much more is part of the FIR filed by the Central Bureau of Investigation (CBI) against the Maran brothers, Maxis Chairman T Ananda Krishnan and Ralph Marshall in connection with the Aircel-Maxis deal announced in December 2005. Widespread raids on Marans’ premises had followed the FIR earlier this month.

“An illegal gratification of Rs 549.96 crore was accepted as quid pro quo through his brother Kalanithi Maran in the garb of share premium invested in Sun Direct TV by South Asia Entertainment Holdings (fully-owned subsidiary of Astro All Asia Networks),” CBI has alleged in the FIR. The FIR added that Dayanidhi Maran, by abusing his official position deliberately, caused undue delays and denials of legitimate requests of Aircel, rendered disservice to Aircel paving the way for Maxis to acquire Aircel from Sivasankaran.

The FIR details the history of Aircel and its expansion plans. It was in March 2004, that Siva wanted to expand the service area through his company Dishnet. According to CBI’s findings, Dayanidhi Maran, had held his file for 44 days for ‘frivolous and uncalled for queries’. This, even after Nripendra Misra, the then telecom secretary, along with other department of telecommunications officials, had unanimously recommended issuance of letter of intent to Siva for UP East and West licences. CBI, in the FIR, has alleged that Maran brothers restricted the business environment for the Siva group.

After speaking with both the Marans on November 12, 2005, Siva got to meet Marshall at a luxury hotel in Chennai. Siva was presented with four offers for the sale of 100 per cent equity of Aircel to Maxis. Siva took his pick and chose to retain an upside share of 26 per cent of the equity in Aircel.

Thereafter, the developments seem to have taken place like clockwork.

On December 26, 2005, Aircel was taken over by Global Communications, a wholly-owned subsidiary of Maxis Communications, and Deccan Digital Network, a joint venture company formed between Sindya Securities and Global Communications. Even as the deal was being signed, Sivasankaran received a call from the Malaysian tycoon T Ananda Krishnan. He told Siva that an initial public offer would be issued immediately and his 26 per cent upside would be more than $800 million, according to the FIR.

Meanwhile, a Maxis group company, Astro All Asia Networks, through its subsidiary South Asia Entertainment Holding, invested Rs 629 crore and purchased equity shares of Rs 10 each of Sun Direct, Chennai at a premium of Rs 69.57 per share. According to CBI’s investigations, these transactions took place from February 18, 2005, to September 30, 2008. Soon after the deal, all the pending licences were granted to Aircel (now controlled by Maxis). All the pending seven licences were granted on December 18, 2006, the FIR has said.