Hutch not to sell majority pie to Orascom

Hutchison Whampoa has no intention of selling majority equity stake to Orascom in Hong Kong-based Hutchison Telecommunications International Ltd (HTIL).

Orascom has already bought 19.3 per cent equity in HTIL "" the company through which Hutchison controls 67 per cent equity in its Indian joint venture, Hutchison-Essar Ltd.

Hutchison sources said there was no question of the group giving majority stake to the Egyptian giant, though it could raise its holding to about 23 per cent. Orascom, which holds about 10 per cent in the Indian operations indirectly through its holdings in HTIL, has come under scrutiny in India.

The Ruias, who are the joint venture partners of Hutchison in India, have opposed any such move as this would mean getting a new partner without their approval. The Ruias have told the Government that they had the first right of refusal in buying Hutchison's stake in the joint venture.

They have been peeved at the 'backdoor entry' of Orascom into the joint venture though HTIL. Under the deal between Hutchison Whampoa and the Ruias, the Hong Kong-based company has to first offer stakes to its Indian partner before soliciting other bidders in the Indian joint venture.

Hutchison Essar had raised this issue years ago when Hutchison Whampoa had sold 19.3 per cent equity to Orasom in 2005, allegedly without giving the Indian partner the first refusal right.

A section of the government has already raised the flag of national security as Orascom operates GSM networks in Pakistan and Bangladesh.