Etisalat has vowed to fight a "baseless" legal claim made by its partner in Etisalat DB, the company's troubled joint venture in India.
Video: The Indian saga has already hit Etisalat shares
Farah Halime looks at a tough morning for Etisalat.
More from Sound & Vision
The telecommunications company, based in Abu Dhabi, said it would "resolutely defend" the proceedings filed against it by two executives who are currently in jail on corruption charges.
The action, against Etisalat and "various individual directors of Etisalat DB", has been filed with the Company Law Board in India, according to a statement issued to the Abu Dhabi bourse.
Etisalat's statement did not specify the reason for the action, although Indian media reported it was because of alleged "operational mismanagement".
The proceedings were served by Majestic Infracon Private, which owns 45.73 per cent of Etisalat DB, a joint venture with the UAE operator. Majestic is controlled by Shahid Balwa and Vinod Goenka, who were arrested earlier this year in an alleged corruption scandal involving the allocation of India's second-generation mobile phone licence. DB Group, which controls Majestic and in which Mr Balwa and Mr Goenka hold executive positions, declined to comment when contacted by The National. The company and its officials have denied any wrongdoing, according to press reports.
The legal claim is to "the detriment" of Etisalat DB's shareholders and customers, Etisalat said.
"This is a cynical tactical move by parties charged with major corruption offences to shift attention away from their own situation and to disrupt the proper running of Etisalat DB," the company said.
"The management of Etisalat DB has been made dramatically more difficult by Mr Balwa and Mr Goenka being in prison," it added.
Etisalat acquired its stake in Swan Telecom for US$900 million (Dh3.3 billion) in March 2009 in a deal that included management control.
The company was later renamed Etisalat DB, in which the UAE firm currently owns a 44.73 per cent stake.
Etisalat said it was "investigating closely [how] Mr Balwa persuaded it to invest in Swan".
The company reiterated it made the investment in the joint venture after Swan had obtained the operating licences subject to the corruption investigation. Shares in Etisalat, which are traded on the Abu Dhabi Securities Exchange, closed unchanged yesterday at Dh10.85.
Simon Simonian, a telecoms analyst at Shuaa Capital, said his firm had not revised its price targets for the company in light of the legal claim.
"We're not assigning any value for the Indian startup operation," Mr Simonian said. "I don't think it will have an impact on the share price."
Mr Simonian said he believed Etisalat had "good" intentions in pursuing its Indian venture. "They believed in the long-term potential in India, they felt they need to be there, and they wrote a big cheque. And suddenly they find themselves in the midst of this mess, the scam allegations," he said.
Matthew Reed, an analyst at Informa Telecoms & Media, said the Indian venture was in line with Etisalat's plan for international expansion. But he said it had faced difficulties.
"Etisalat is being thwarted … by fierce competition in the Indian market, which led it to hold back from a full launch; and then more recently by a series of adverse political and legal developments," Mr Reed said.
bflanagan@thenational.ae
Electoral College Victory
Trump has so far secured 295 Electoral College votes, according to the Associated Press, exceeding the 270 needed to win. Only Nevada and Arizona remain to be called, and both swing states are leaning Republican. Trump swept all five remaining swing states, North Carolina, Georgia, Pennsylvania, Michigan and Wisconsin, sealing his path to victory and giving him a strong mandate.
Popular Vote Tally
The count is ongoing, but Trump currently leads with nearly 51 per cent of the popular vote to Harris’s 47.6 per cent. Trump has over 72.2 million votes, while Harris trails with approximately 67.4 million.
MATCH INFO
Uefa Champions League final:
Who: Real Madrid v Liverpool
Where: NSC Olimpiyskiy Stadium, Kiev, Ukraine
When: Saturday, May 26, 10.45pm (UAE)
TV: Match on BeIN Sports
COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
Company%20profile
%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%20Fasset%0D%3Cbr%3E%3Cstrong%3EStarted%3A%20%3C%2Fstrong%3E2019%0D%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Mohammad%20Raafi%20Hossain%2C%20Daniel%20Ahmed%0D%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20Dubai%0D%3Cbr%3E%3Cstrong%3ESector%3A%20%3C%2Fstrong%3EFinTech%0D%3Cbr%3E%3Cstrong%3EInitial%20investment%3A%3C%2Fstrong%3E%20%242.45%20million%0D%3Cbr%3E%3Cstrong%3ECurrent%20number%20of%20staff%3A%3C%2Fstrong%3E%2086%0D%3Cbr%3E%3Cstrong%3EInvestment%20stage%3A%3C%2Fstrong%3E%20Pre-series%20B%0D%3Cbr%3E%3Cstrong%3EInvestors%3A%3C%2Fstrong%3E%20Investcorp%2C%20Liberty%20City%20Ventures%2C%20Fatima%20Gobi%20Ventures%2C%20Primal%20Capital%2C%20Wealthwell%20Ventures%2C%20FHS%20Capital%2C%20VN2%20Capital%2C%20local%20family%20offices%3C%2Fp%3E%0A
Business Insights
- Canada and Mexico are significant energy suppliers to the US, providing the majority of oil and natural gas imports
- The introduction of tariffs could hinder the US's clean energy initiatives by raising input costs for materials like nickel
- US domestic suppliers might benefit from higher prices, but overall oil consumption is expected to decrease due to elevated costs
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
The specs
Engine: Long-range single or dual motor with 200kW or 400kW battery
Transmission: Single-speed automatic
Max touring range: 620km / 590km
Price: From Dh250,000 (estimated)
RESULTS
Catchweight 82kg
Piotr Kuberski (POL) beat Ahmed Saeb (IRQ) by decision.
Women’s bantamweight
Corinne Laframboise (CAN) beat Cornelia Holm (SWE) by unanimous decision.
Welterweight
Omar Hussein (PAL) beat Vitalii Stoian (UKR) by unanimous decision.
Welterweight
Josh Togo (LEB) beat Ali Dyusenov (UZB) by unanimous decision.
Flyweight
Isaac Pimentel (BRA) beat Delfin Nawen (PHI) TKO round-3.
Catchweight 80kg
Seb Eubank (GBR) beat Emad Hanbali (SYR) KO round 1.
Lightweight
Mohammad Yahya (UAE) beat Ramadan Noaman (EGY) TKO round 2.
Lightweight
Alan Omer (GER) beat Reydon Romero (PHI) submission 1.
Welterweight
Juho Valamaa (FIN) beat Ahmed Labban (LEB) by unanimous decision.
Featherweight
Elias Boudegzdame (ALG) beat Austin Arnett (USA) by unanimous decision.
Super heavyweight
Maciej Sosnowski (POL) beat Ibrahim El Sawi (EGY) by submission round 1.
Ads on social media can 'normalise' drugs
A UK report on youth social media habits commissioned by advocacy group Volteface found a quarter of young people were exposed to illegal drug dealers on social media.
The poll of 2,006 people aged 16-24 assessed their exposure to drug dealers online in a nationally representative survey.
Of those admitting to seeing drugs for sale online, 56 per cent saw them advertised on Snapchat, 55 per cent on Instagram and 47 per cent on Facebook.
Cannabis was the drug most pushed by online dealers, with 63 per cent of survey respondents claiming to have seen adverts on social media for the drug, followed by cocaine (26 per cent) and MDMA/ecstasy, with 24 per cent of people.
Citadel: Honey Bunny first episode
Directors: Raj & DK
Stars: Varun Dhawan, Samantha Ruth Prabhu, Kashvi Majmundar, Kay Kay Menon
Rating: 4/5
Disclaimer
Director: Alfonso Cuaron
Stars: Cate Blanchett, Kevin Kline, Lesley Manville
Rating: 4/5
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
From Zero
Artist: Linkin Park
Label: Warner Records
Number of tracks: 11
Rating: 4/5