New Delhi: The government on Friday said the alleged violation of market regulator SEBI's takeover-related regulations by the promoters of telecom major Bharti Airtel is being examined.
Minister of State for Communications and Information Technology Milind Deora said in a written reply to the Rajya Sabha that SEBI had received complaints alleging violation of takeover rules by Bharti Airtel's promoter group, along with complaints regarding the then proposed Bharti-MTN deal.
The deal could not fructify despite months of talks during 2008-2009 between Bharti and South Africa's MTN.
"With regard to the alleged violations of SEBI (Subsntial Acquisition of Shares and Takeover) Regulations, 1997, by the promoter group of Bharti Airtel Ltd, SEBI had sought comments from concerned entities, and the matter is under examination," Deora said.
In reply to another question, Deora said SEBI had received a letter dated June 18, 2009 from Bharti Airtel, whereby it sought informal guidance about certain issues arising out of its then proposed deal with the MTN Group.
"In response to the said letter, the regulator in its informal guidance dated June 22, 2009 gave its views regarding the requirement of compliance with open offer-related provisions of SEBI's takeover regulations by MTN and its shareholders upon conversion of GDRs into equity shares with voting rights," the minister said.
Bharti and MTN had first disclosed their talks in May, 2008 for a possible merger, but the discussions fell apart soon, only to be revived about a year later. After a fresh round of negotiations, the deal was again called off in September, 2009.
In between, the Indian telecom major had written to SEBI on June 18, 2009, seeking an informal guidance about the proposed deal, which it said involved Bharti Airtel acquiring 49 percent stake in MTN after issuance of Global Depository Receipts (GDRs) to MTN and its shareholders.
The GDRs, if exchanged for underlying shares, would constitute for about 25 percent stake by MTN in Bharti Airtel, the company had said.
Among other issues, Bharti had sought to know whether MTN would be required to comply with the open offer requirements upon exchange of the GDRs for shares.
SEBI, in its informal guidance, had told Bharti Airtel that MTN would have to make an open offer if it converts GDRs into shares of the Indian company.
First Published: Friday, August 17, 2012, 19:31