The week in review for 11 June 2010

The week in review for 11 June 2010

The auction for BWA spectrum is over, but has thrown up some surprises. One surprise is the big winner, Infotel, which has won spectrum all across Indian by agreeing to pay nearly Rs13,000 crore. The other big surprise is Infotels’ new owner. Soon after the auction results became public on Friday, Reliance Industries announced it was buying 95% of Infotel for Rs4,800 crore. Friday’s move brings Reliance Industries back in the telecom game after five long years. The company has been out of the sector since the Ambani brothers broke up back in 2005.

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After more than a quarter of a century, we finally have a judgment in the Bhopal gas tragedy. On Monday a lower court in Bhopal ordered all seven of the accused to two years in jail. It has also fined them Rs100,000 each. The convicted men include Keshub Mahindra, the current chairman Mahindra and Mahindra, who back in 1984 was non-executive chairman of Union Carbide India. Mahindra and the six others convicted men all got bail.

And the government may have created new norms for publicly listing companies, but it then spent the week dealing the fallout. After PSU’s started asking for changes, finance secretary Ashok Chawla indicated the government would ease the rules if necessary. The new listing norms make it compulsory for listed companies to float at least twenty five percent of their shareholdings. But PSU’s are worried the resultant glut of new public issues will bring down their share prices.

And the new listing norms are also facing challenges from India’s insurance regulator. This week IRDA said it wouldn’t make insurers hike their publicly held stakes to the new twenty five percent minimum unless the government changed foreign investment rules. IRDA wants the foreign direct investment in insurance to be increased to 49% from the current 26%. Some of India’s top private insurers plan public floats in the near future.