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Tata to deposit $1.2 billion DoCoMo arbitration award with Delhi court

Published 28/07/2016, 20:18
© Reuters. People travel in a truck under a large advertisement of Tata's wireless internet device in Hyderabad
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(Reuters) - India's Tata Sons Ltd said it expected to deposit $1.2 billion (913.59 million pounds) with the Delhi High Court on Friday, the money it was ordered to pay Japan's NTT DoCoMo Inc (T:9437) by an international arbitration court last month.

Tata Sons also rejected reports suggesting the possibility of its UK assets being seized as a result of the ruling.

In 2009, DoCoMo bought a 26.5 percent stake in Tata Teleservices Ltd but announced plans in 2014 to exit the venture, which struggled to boost subscribers as quickly as its peers.

DoCoMo then asked Tata to find a buyer for its stake at a pre-determined price. Tata failed to find a buyer and instead offered to buy the stake itself.

India's central bank, however, rejected Tata's offer, saying a rule change in the previous year prevented foreign investors from selling stakes in Indian firms at a pre-determined price.

India plans to block Tata's payment of the arbitration award to avoid setting a precedent as at least 10 other companies have sought waivers for similar deals, Bloomberg reported on Thursday, citing people familiar with the matter. (http://bloom.bg/2az5yk3)

© Reuters. People travel in a truck under a large advertisement of Tata's wireless internet device in Hyderabad

The Delhi high court has given the companies until August 30 to resolve the issue.

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