Aircel Maxis case: After the arbitration award what's left of the case
The entire CBI case rests on the complaint of Sivasankaran about being “coerced” to sell the company
Hardnews Bureau Delhi
Two former Chief Justices of the Supreme Court have found little merit in the allegations levelled by C. Sivasankaran of Siva Ventures and formerly the owner of Aircel Televentures that he was coerced by former Telecom minister Dayanidhi Maran to sell 100 percent shares of his telecom company to Malaysia’s Maxis. In the opinion of one Chief Justice this allegation, which is being investigated by CBI, “is untenable”. Both the judges also state that this is a civil dispute between the two business houses and does not need a criminal investigation.
The two ex CJI of Supreme Court were giving their opinion sought by the aggrieved party Maxis Communications Berhard. Their view is an endorsement of an order passed by the Singapore International Arbitration Council. Sivasankaran had gone in for arbitration before them where he claimed breach of trust against Maxis for not crystallising 26 percent upside payment. Maxis did not undertake an IPO within the stipulated period that was provided in the Share Purchase Agreement (SPA) due to which Siva was deprived of his upside sharing cost.
The legal opinion of the two ex CJI are part of the letter written by Maxis Chairman Raja Tan Sri Dato Seri Raja Arshad to CBI Director Ranjit Sinha on August 2, 2013.
The entire CBI case rests on the complaint of Sivasankaran about being “coerced” to sell the company. The opinion of both the former Chief Justices and the interpretation of the order of Singapore International Arbitration Council clearly indicate that Sivasankaran does not give an impression that he was forced to sell his company. Legal opinion of the ex-CJI's shows that the complaint was an “after thought”. Here is why.
Siva was eager to sell his stake in Aircel to whom so ever would have given him the best deal. He made a presentation to Maxis on November 4, 2005. Initially, he was asking for more, but later he agreed to a valuation of $ 800 million, which is based on the valuation of a part of Bharati’s telecom business, which has a pan-India footprint. After one such meeting he wrote to Ralph Marshall of Maxis that it was a pleasure to meet with him and indicated how step-by step the takeover of the company could be facilitated. Surely, someone who had been under duress would not have engaged in such pleasantries.
Siva was given 4 options to choose from and as stipulated above he decided to go in for option B, which meant giving 100 percent equity and 26 percent upside payment. If indeed he was coerced to go for this option, as the ex-CJI legal opinion says, there would not have been further emails suggesting further negotiations. As an ex-CJI states, “ extensive negotiations between parties show that it’s a normal commercial transaction in which Siva got the valuation that he wanted.” The fact that he was eager to sell his stake at the earliest possible opportunity and give it at a reduced amount shows that it is “incorrect to suggest that he was forced to sell his stake. “