NTT DoCoMo exits TTSL after Tata Sons pay $1.2bn settlement
Payment by Indian firm Tata brings to a close a three-year dispute over DoCoMo's 26.5% stake in Tata Teleservices
Tata Sons has settled a three-year dispute with NTT DoCoMo over Tata Teleservices after paying the Japanese firm a $1.27 billion settlement fee.
NTT DoCoMo said it has now received the money from the Indian company, which it was awarded by an international arbitration court last year, meaning it has now exited its 26.5% stake in TTSL.
“Concurrent with the receipt of the above amount, all shares in TTSL held by DoCoMo have been transferred to Tata Sons and companies designated by Tata Sons,” the Japanese company said in a filing with the Tokyo Stock Exchange.
In February this year, Tata Sons said it had reached an agreement with DoCoMo “on a joint approach to enable enforcement” of a compensation award granted by the London Court of International Arbitration in 2016 in favour of the Japanese company.
The payment was delayed by the Reserve Bank of India, who objected to the transfer of money citing Foreign Exchange Management Act regulations. A high court in Delhi rejected this in April.
The long-running dispute started in 2009 when NTT DoCoMo bought a 26.5% stake in TTSL for $2.7 billion, with the Indian company pledging to hit certain performance milestones over the next five years. If it failed to hit these, Tata would be obliged to find a buyer for DoCoMo's shares at market price.
In 2014, the Japanese operator said it would exit TTSL following a failure to meet targets, and later filed against Tata Sons, claiming it had failed to find a buyer for DoCoMo's stake.
Tata has since agreed to offload its consumer mobile business to Bharti Airtel with Airtel assuming Tata Teleservices’ 40 million customers. The transaction will also give Bharti Airtel, India’s largest mobile operator, the right to use Tata’s existing fibre network.