Date:10/01/2006 URL: http://www.thehindubusinessline.com/2006/01/10/stories/2006011002490400.htm

Back FIPB defers decision on Bharti merger

Ambarish Mukherjee
Thomas K. Thomas

New Delhi , Jan. 9

THE Foreign Investment Promotion Board (FIPB) has deferred a decision on allowing Bharti Tele-Ventures Ltd (BTVL) to merge all its companies and become the operating arm for the purpose of being governed by the provisions of automatic route for investment under the existing foreign direct investment norms.

The deferment comes after the Department of Telecom sought more time to study the proposal since the holding company had now become the operating company.

Bharti Tele-Ventures had been consolidating its operations of providing cellular mobile , fixed line , long distance and broadband services. These businesses were formerly operated through its two main subsidiaries, Bharti Cellular Ltd and Bharti Infotel Ltd, which have been merged into Bharti Tele-Ventures.

The merger was approved by the Delhi High Court and registered with the Registrar of Companies. Bharti had requested the FIPB to take note of the fact that BTVL had now become the operating company and would, therefore, be governed by the provisions of automatic route for investment under FDI norms.

As per the current policy, FDI up to 74 per cent is allowed in the telecom sector, while FDI up to 49 per cent is through the automatic route. While FIPB had given its nod to the proposal, it was decided to defer the matter for two weeks after DoT sought time to look into the proposal in detail.

BTVL's shares are listed on the BSE. The company has over 16 million mobile subscribers across the country under the brand Airtel.