Vodafone Edges Closer to Completing Indian Purchase

India's Law Ministry is reported to have given clearance to Vodafone's purchase of Hutchison-Essar, clearing one hurdle which had been embroiled in controversy over the percentage of foreign ownership in the company.

The Economic Times newspaper says that it has learnt that the ministry sent no-objection to the Foreign Investment Promotion Board (FIPB) last week, stating that there has been no breach of the cap on foreign shareholdings in the company. There had been allegations of "benami" shareholdings by Analjit Singh and Asim Ghosh, who while Indian nationals, were in effect acting on behalf of Hutchison Telecom - and hence their shareholdings should have been treated as foreign controlled.

The FIPB is expected to formally anounce its views on the issue - based largly on the investigation by the Law Ministry, sources said."

Posted to the site on 23rd April 2007