Dhoot offers to buy out Nahata stake in Datacom Solutions

The Dhoots of the Videocon group have offered to buy Mahendra Nahata’s 36 per cent stake in all-India mobile licence holder Datacom Solutions.

The move comes after Nahata had threatened to go to court against Dhoot for alleged violations in the shareholders’ agreement.

Nahata holds 36 per cent in Datacom through a closely-held company, Jumbo Techno Services.

Confirmation of the offer came from Nahata, who said, “Discussions are on including buy-outs but no final decision has been taken,” adding that he reserved the right to legal recourse if the dispute was not settled.

However, Venugopal Dhoot, chairman of the Videocon group, denied that an offer had been made. “We have not talked to him on this matter, nor has he spoken to us,” he said.

Datacom received a mobile licence a few months ago when the shareholding was divided between Nahata and some other investors. Videocon later came in as a 64 per cent partner.

Disagreements between the two arose over investments in the company. Sources with knowledge of the deal said the two partners agreed to subscribe to an initial equity capital of Rs 150 crore. The Dhoots also agreed to put in further equity investments of around $1 billion (almost Rs 4,200 crore) needed to set up the network infrastructure.

Sources in Nahata’s camp said he was not required to make such further investment and his stake would remain intact at 36 per cent — a reward for getting the licence from the government. Jumbo also alleged that Videocon had said it would not bring in more equity but offered a loan to finance the project. This was unacceptable to Jumbo, and the issue became a bone of contention between the two partners.

The valuation of Nahata’s stake is not clear, though analysts say the value of all-India GSM licences is $1-2 billion.

Datacom Solutions could see its plans to start operations in GSM mobile services from August 15 and rope in strategic investors delayed as a result of the dispute.

The company has held talks with Dubai-based Etisalat and Batelco of Bahrain, according to informed sources, but no final deal has emerged.