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Our Bureau

New Delhi, June 25 Even as the Ambani brothers are fighting over Reliance Communication, there is another corporate battle brewing in the telecom sector -- between Himachal Futuristics Communications Ltd (HFCL) and Videocon over Datacom.

HFCL has alleged that Videocon was ignoring the minority shareholders and was taking important decisions on its own against the spirit of good corporate governance. Fearing legal action by HFCL, Videocon has filed a caveat in major High Courts against any judicial order prior to a hearing. Datacom has recently bagged pan Indian telecom licence and has also received spectrum in a few circles.

According to industry sources close to the development, Datacom was initially owned by HFCL’s Chairman Mr Mahendra Nahata who later sold around 64 per cent stake to Videocon. Earlier Videocon had also submitted its application for telecom licences but it was put on hold after the Department of Telecom decided that only those applications which were received before September 25 would be processed. Videocon had applied after September 25.

In order to keep its telecom ambitions alive, Videocon bought out the majority stake in Datacom, which was among the first 5 companies to get a new licence. Prior to Videocon’s acquisition, almost 90 per cent stake was owned by HFCL-backed Jumbo Techno Services (p) Ltd and another 10 per cent by Oswal Fertilizers & Chemical Ltd, according to records available with DoT.

One of the reasons for HFCL to dilute its stake in Datacom was that it had put in another set of applications for pan India telecom licence. However, HFCL’s second application was later rejected by DoT leaving the company to fulfil its telecom plans also through Datacom.

But sources close to HFCL alleged that Videocon was not adhering to the commitments made at the time of picking up the equity in Datacom. Sources in Videocon refuted these claims and said that there was no problem between the various stakeholders in Datacom.

When contacted both Mr Nahata and Videocon’s Chairman, Mr Venugopal Dhoot, refused to comment on the dispute.

In an earlier interview with Business Line, Mr Dhoot had said that Datacom was a Videocon company from the beginning and there was no commitment or deal with HFCL.

If the issue reaches the court then it could prove detrimental to Datacom’s rollout plans. The company is in the process of finalising a deal to procure network equipment to support 75 million subscribers. Videocon has also been scouting for an international partner to invest into Datacom.

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Himachal Futuristics, Videocon spar over Datacom

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