New Delhi: Etisalat DB Telecom Pvt. Ltd on Wednesday said it will shut its network and services to pare costs, a day after STel Ltd announced it was helping subscribers move to other networks.
“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 DB, which had 1.7 million subscribers at the end of December, said in a statement.
The company did not say whether it was going to compensate or help subscribers affected by the shutdown.
It also did not disclose details of what will happen to its investments.
The move comes after the Supreme Court on 2 February cancelled 122 telecom licences and radio spectrum held by nine companies.
The apex court ordered that the air waves be re-auctioned in four months after the Telecom Regulatory Authority of India sets new guidelines.
The decision removed Etisalat DB’s ability to operate from 2 June, the date when the Supreme Court said the cancelled licences become void.
Etisalat DB is a venture of Shahid Balwa-promoted Dynamix Balwas group (DB Group) company Swan Telecom and the United Arab Emirates-based Emirates Telecommunications Corp., or Etisalat, in which the latter owns 44.73% stake, which was acquired in September 2008 for around $900 million, valuing the Indian company at around $1.2 billion. Etisalat DB has licences in 15 telecom licence areas and started services under the Cheers brand name.
On Tuesday, STel said it was helping its customers port out of its network as it was unable to secure funding for its business and its vendors were disconnecting services. Swan Telecom’s promoter Shahid Balwa and managing director Vinod Goenka are facing criminal proceeding related to corruption in a special court looking into the second-generation spectrum scam.
shauvik.g@livemint.com
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