Foreign investment regulator in India (FIPB) has deferred a decision on Vodafone Group Plc’s proposal to increase its stake to 100 percent in its Indian telecom venture in a $1.6 billion deal.
Reuters reported that the regulator deferred the decision as it had not received security approvals from the interior ministry. The report quoted unnamed government officials.
Vodafone is currently facing a $2 billion plus tax settlement case in India after it entered India, the second largest mobile phone market in the world based on subscribers.
The U.K.-based Vodafone, which entered India in 2007 by buying Hutchison Whampoa’s local cellular assets in an $11 billion deal, directly and indirectly owns a combined 84.5 percent of Vodafone India, the country’s No.2 telecom operator based on mobile users.
Vodafone directly owns 64.38 percent of the India unit.
In August, India relaxed rules on foreign holdings in the telecom service sector to allow companies such as Vodafone to own 100 percent of their Indian businesses from the earlier 74 percent.
