Date:14/06/2008 URL: http://www.thehindu.com/2008/06/14/stories/2008061453281500.htm

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Ambani war erupts again

Anil Ambani camp alleges sabotage by RIL in MTN bid

ADAG says RIL claim baseless
RIL spokesperson declines to comment

NEW DELHI: War between the Ambani brothers on the family settlement erupted again tonight with younger sibling Anil’s group charging Mukesh’s Reliance Industries of attempting to sabotage its potential deal to acquire South African telecom giant MTN.

A spokesperson Mukesh Ambani-led RIL declined to comment on the allegations that it was seeking to “disrupt creation of one of the world’s most valuable telecom combinations.”

Alleging that RIL had sent a communication to the MTN group making a false claim of alleged right of first refusal to buy controlling stake in Reliance Communications, ADAG spokesperson said, “RIL’s claim is legally and factually untenable, baseless and misconceived.”

Asserting that RCom’s negotiations with the MTN group for amalgamation were going well and that the Mukesh group’s “mala fide” attempt would not derail the process, the spokesperson said that ADAG has received this evening from MTN the communication made by RIL, which he dubbed as “an attempt borne out of mounting despair and frustration.”

The ADAG spokesperson said that at a time when exclusive negotiations were going on between RCom and the MTN Group, RIL’s “false claim” of an “alleged Right of First Refusal” to buy the controlling stake in RCom is “legally and factually untenable”.

He described the RIL claim as “baseless and misconceived”. He said RIL had based its claim on an agreement of January 12, 2006, which was “unilaterally” signed by its own officials when RCom was under the RIL control. However, this “procedure” was held to be “unfair and unjust” by the Bombay High Court on October 15, 2006, the ADAG spokesman said. He said the RIL claims was from “frustration at ADAG Group’s continuing success and the support it enjoys from 10 million investors — the world’s largest shareholding family.”

RCom got into the negotiations with South African giant MTN for a deal last month, aimed at creating one of the world’s ten largest telecom companies, with a potential worth of $70 billion.

Before RCom took a plunge, MTN and Bharti Airtel were in talks, which, however, did not fructify. — PTI