Ending a three-year-old dispute, Tata Sons has paid nearly $1.27 billion (144.9 billion yen) to NTT DoCoMo, enabling the Japanese company to exit its 26.5 per cent stake in Indian telecom operator Tata Teleservices Ltd (TTSL).

The payment in accordance with a Delhi High Court order earlier this year. Tata Sons had kept the entire amount in an escrow account while the case was being heard.

Following the payment, NTT DoCoMo, Japan’s leading mobile operator, no longer holds any equity investment in TTSL.

“Concurrent with the receipt of the above amount, all shares in TTSL held by DoCoMo have been transferred to Tata Sons and companies designated by Tata Sons,” NTT DoCoMo said in a statement.

In February this year, Tata Sons said it had reached an agreement with DoCoMo “on a joint approach to enable enforcement” of a compensation award granted by the London Court of International Arbitration in 2016 in favour of the Japanese company.

However, the Reserve Bank of India had objected to the transfer citing Foreign Exchange Management Act regulations. In April, the Delhi High Court rejected the apex bank’s stand.

In 2009, NTT DoCoMo had acquired a 26.5 per cent stake in TTSL for $2.7 billion (₹13,070 crore at the then exchange rate). Under the shareholders’ agreement, if TTSL failed to achieve certain performance milestones over the subsequent five years, the Tata group would have to find a buyer for the shares held by the Japanese company at market price. If it failed to find a buyer then the Tata group itself had to buy the shares at a 50 per cent discounted price (termed a put option).

In April 2014, the Japanese firm announced plans to sell its entire stake in TTSL, exiting India five years after it ventured into the country. The exit came after the Indian company failed to achieve certain performance targets.

Later, NTT DoCoMo filed for arbitration stating that Tatas had failed to find a buyer for its stake in TTSL.

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