Unitech approached Court against Estranged Joint Venture Partner Telenor

Indian real state firm Unitech Limited on 30 March 2012 moved a local court, seeking to prevent partner Telenor  from getting into any competing business venture or transferring their telecom joint venture to a new entity.

The company through this move aims at protecting its investment in the telecom business. Unitech owns about 33% of Unitech Wireless Limited., which offers mobile phone services under the Uninor brand and has about 40 million subscribers. Telenor owns the rest.

The dispute between the two parties, erupted following Supreme Court’s verdict of quashing all 122 mobile-phone licenses - including 22 of Unitech Wireless - calling the allocations arbitrary and underpriced. The affected companies have been allowed to continue operations until the order becomes effective after 2 June 2012.

Telenor held Unitech responsible for breach of warranties related to the license cancellation and seek compensation for all investments, guarantees and damages caused by the court's decision.
The Norwegian firm wants its joint venture with Unitech to be annulled and seeking the prevention of Unitech from hampering its attempt to continue its Indian operations under a new venture in which it could possess 74% stake.

The Unitech, which has squarely denied all the claims of Telenor, is pushing it hard to prevent Telenor from acquiring full control over the business, including its assets.

The two companies have also approached the Company Law Board, a quasi-judicial body, to sort out the dispute.