Etisalat draws line under disaster investment in India

Etisalat has secured a court order winding up its failed Indian joint-venture with DB Group.

Etisalat DB was one of a number of joint-ventures set up in the wake of the 2008 GSM licence allocation, and was effectively closed down by the Supreme Court decision to cancel the concessions.

The directors of the DB Group are facing criminal charges concerning how they secured the licences prior to the investment in the venture by Etisalat.

Citing the deadlock between the two companies, the Bombay High Court accepted a petition from Etisalat to wind up the company.

"There is complete lack of faith and probity resulting in irretrievable breakdown between the major shareholders of the company. The liabilities of the company have far exceeded its assets," Justice Kathawalla said.

Etisalat paid US$900 million for a 44.7 per cent stake in an Indian start up mobile network, Swan Telecom (renamed Etisalat DB) in March 2009. The company had licences covering 13 of the country’s 22 operating circles and had received radio spectrum in 10 of the circles.

Etisalat later wrote off the investment.