A long-standing issue between Tata Communications and the Centre has been finally resolved with the Ministry of Corporate Affairs giving its approval to demerge surplus land held by the erstwhile Videsh Sanchar Nigam Ltd into a new entity — Hemisphere Properties India Ltd (HPIL).
The Tata Group had acquired stake in VSNL in 2002 as part of the Centre’s disinvestment programme. VSNL was fully acquired by the Tatas in 2008 and renamed Tata Communications. While the telecom business under VSNL was transferred to Tata Communications, there was a dispute related to the surplus land held by VSNL.
On Thursday, Tata Communications said: “We are pleased that we have reached a successful resolution because it clears the way to demerge approximately 773.13 acres of surplus land from Tata Communications into HPIL, settling a long-standing matter.”
“More importantly, once the scheme is implemented, it will offer direct benefits to our shareholders, whereby HPIL will provide shares to all the shareholders of Tata Communications in the ratio 1:1, mirroring the shareholding of Tata Communications,” it added.
Furthermore, according to the scheme, Panatone Finvest Ltd (a special purpose vehicle under the Tata group of companies) will transfer its HPIL shares, which will mean that the Centre and the shareholders who had surrendered their shares in Panatone’s open offer in 2002 will receive shares as follows: 25 per cent to Government of India; 20 per cent to the shareholders of VSNL who had surrendered their shares in the open offer of Panatone in 2002; and 3.87 percent to be retained by Panatone Finvest Ltd, which the company acquired from the open market.—The Hindu Business Line