Tata hopes to win back stakes in Birla company - Tata cockfight : Tata Teleservices VS Idea Cellular

By Subhankar Kundu @ Thursday, July 10, 2008 3:13 PM

Section - Business/Financials

With Idea acquiring Spice to expand its reach, the merrymaking time couldn’t last for long as Tata strikes back to get back into Idea Cellular after its long fight with Birla company.

The supreme court of India has finally found a way to resolve the fight between the Tatas and the Birlas by appointing a three member arbitration panel.  The Indian business major, Tata has managed to convince the Indian apex court to soften its stand towards the Tatas after fighting out a  the two year-old battle with the A.V. Birla Group’s  demand to get the Tata out of Idea cellular.

Tata Group may have the right to buy out Birla’s stake in Idea Cellular in case the court rules the judgement Tata’s favour but Birla’s claim cannot be blown away. Tata already has its own telecom services in the name of Tata Teleservices. The Indian government had to intervene and get the Tata out of Idea as the rules do not allow a company to hold more than 10 per cent stake in two different telecom companies. The Birla group bought out the entire 48.14% stake of Tata at more than $100 million (4406 crore INR).

Tata then took the Birlas to court for the alleged violation of the shareholders’ agreement in disclosing sensitive information on the A.V. Birla Group web site. X