* Etisalat to suspend network, services of Indian JV
* JV to cut operating costs
(Adds details from statement)
NEW DELHI, Feb 22 (Reuters) - United Arab Emirates
telecom operator Etisalat on Wednesday said it would
shut down the operations of its Indian joint venture, three
weeks after an Indian court cancelled the affiliate's licence
amid a corruption probe.
On Feb. 9, Etisalat wrote off $827 million relating to India
unit Etisalat DB (EDB), in which it owns a 45 percent stake,
after the affiliate's 15 licences were among 122 the Supreme
Court ordered to be scrapped.
"The decision of the Supreme Court ... has removed EDB's
ability to operate," Etisalat said in an emailed statement.
"As unanimously resolved by the (Etisalat) board this
evening, Etisalat DB will be taking steps to reduce operating
costs, including the suspension of its network and services.
"The decision has been taken in order to protect the
interests of all stakeholders and to avoid incurring further
costs at this time of rapid change and continued uncertainty in
the Indian telecommunications sector."
Etisalat will decide on any future activity in India "when
there is clarity on the auction process and telecommunications
policy and greater legal and regulatory certainty and
stability," it added.
The companies whose licences are being cancelled can bid in
an auction to regain the licences and radio airwaves.
Etisalat paid $900 million in 2008 for its stake in the
nascent company, then called Swan Telecom, after the licence had
been granted. Etisalat has said it invested more than $1 billion
in the venture, later renamed Etisalat DB.
Top executives of Etisalat's India partner DB Group and the
joint venture mobile company are among 19 people and six
companies charged by police in the telecoms licence scandal,
awaiting trial.
Etisalat DB has licences for 15 of India's 22 telecom zones
and its 1.7 million subscribers as of December ranked it 14th in
a 15-operator market.
It was slow to roll out services, for which it was rebuked
last year by the Indian government, while in January network
host Reliance Communications said it had cut off
Etisalat DB over non-payment of fees for using its towers.
India revoked 22 mobile licences held by a Telenor
joint venture and on Tuesday the Norwegian operator said it was
dumping its Indian partner, accusing it of "fraud and
misrepresentation".
Bahrain Telecommunications Co (Batelco) agreed to
sell its stake in Indian affiliate S Tel to its Indian partner
after the unit was another to have its licences revoked.
S Tel on Tuesday said it is helping clients switch to other
operators but did not respond directly to reports that it had
decided to shut down.
(Reporting by Devidutta Tripathy, writing by Matt Smith;
Editing by Helen Massy-Beresford)
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