Earlier this week, Vodafone Essar received an income tax notice for tax claims of around $1.7 billion. And now, its 33% partner, Essar has filed for a nationwide telecom licence under the name ShippingStop.com, which is a fully owned subsidiary of BPL Mobile. This step may have a business conflict and may not go down well with Vodafone.
Previously, BPL Mobile was acquired by Hutch-Essar but due to regulatory issues of spectrum transfer, the deal got cancelled. Essar has a 9.9% direct stake in BPL below the 10% limit. It also owns stake in BPL through series of fund associated with Essar. Now, the entire issue of the ownership of BPL is under arbitration.
But the move of Essar may not get any favourable response from the authorities as it is already a part of big telecom combine and has a retail telecom venture. A case in this regard is when Tata Telecom had to give up its stake in Idea Cellular when it applied for a separate licence.
But one positive for Essar may be the fact that TRAI is in favour of doing away with number of operators in a circle. As a result of which, several companies like Parsvnath Developers, Swan Telecom, Datacom Solutions, S Tel, Idea Cellular, Cheetah Corporate Services, Bycell Telecom, Spice Communications and HFCL Infotel have sought for Unified Access licenses.
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