Business

Ambanis indulge in shadow-boxing

MUMBAI: The spat between the warring Ambani brothers over the South African telecom giant MTN turned into a game of legal shadow-boxing on Monday with offers and counter offers for discussions being spurned on both sides.

Wary of falling into a legal ‘trap’, Anil Ambani’s Reliance Communication (RCom) rebuffed an attempt by elder brother Mukesh-led Reliance Industries Ltd. (RIL) to open talks for conciliation over the issue of right of first refusal in RCom’s efforts to amalgamate with MTN, said to be worth over $50 billion.

Top legal and financial brass of RIL turned up at a five-star hotel here in a follow-up to their company’s offer made last week as part of arbitration clause in the non-compete agreement between the two groups, to open conciliation talks with RCom.

After an hour’s wait, the officials left unhappy that the other side did not have a courtesy to even inform that they were not turning up.

The legal manoeuvring picked up pace thereafter with RCom proposing a ‘clarificatory’ meeting next week, making it clear this would not constitute any conciliation or dispute resolution mechanism, a process the company wants to avoid.

RIL, in turn, lost no time in rejecting this proposal and instead threatened legal action against RCom, whose infuriated spokesperson said that this was the third such threat from the elder Ambani’s RIL.

Going public with RCom’s anger, he said, “RIL’s mala fide stand (has been) clearly established. RIL has within hours spurned our offer to meet on July 14.”

In its offer for meeting on July 14, which comes after RIL last week invoking arbitration clause under non-compete agreement and asking RCom to start conciliation as part of process, RCom said the meet would not constitute to any conciliation or dispute resolution process.

Debunking RIL’s claim of right of first refusal as “legally and factually untenable and misconceived, RCom, whose exclusivity agreement with MTN for talks, is coming to end on Tuesday, said the “‘meeting is not part of conciliation or dispute resolution mechanism”.

RCom had announced on May 26 the start of 45-day exclusive negotiations for a possible deal with MTN.

However, the deal has been hit with uncertainties after RIL sent a communication to MTN and RCom claiming its first right of refusal over a majority stake in Anil Ambani-led telecom firm and threatened legal action if its rights were breached by the deal. — PTI

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