Real estate developer DB Realty today said it has no stake in Etisalat DB and its promoters invested in the telecom company in individual capacities.
It further said that DB Realty will not have any financial impact due to the exit of UAE-based Etisalat from India operations.
Yesterday, Etisalat had announced shutting of its India operations following the Supreme Court order cancelling telecom licenses allocated to Etisalat DB and others.
“DB Realty is in the business of real estate development and has no direct or indirect share holding in Etisalat DB.
The promoters of DB Realty in their individual capacity invested in Etisalat DB,” DB Realty said in a statement.
The Mumbai-based developer said DB Realty and Etisalat DB are separate entities.
“Etisalat’s decision to shut down the operations of its Indian joint venture, was taken independently by Etisalat UAE and this decision will have no bearing or impact on the financials of DB Realty,” the statement said.
The statement came amid over 5% fall in share price of DB Realty. It closed at Rs 84.35 on the BSE . During the day, the stock had nosedived by as much as 17% to a low of Rs 73.65. On the NSE also, the scrip closed at Rs 85.25, down 4%.
Meanwhile, Etisalat today said it has filed a lawsuit against the promoters of Swan Telecom (now Etislat DB) alleging fraud and misrepresentation.
Promoters Vinod Goenka and Shahid Balwa later issued a statement that they have not recieved any notice of demand or suit papers yet. “There is no wrongdoing by us or our directors,” the statement read. DB Etisalat had earlier filed a case for mismanagement with the Company Law Board against Etisalat. “The JV was not run properly and it was going nowhere under the management of Etisalat,” they said. The case was withdrawn once Etisalat said that they will run the JV properly henceforth. The venture however is facing FEMA proceedings for investment by Etisalat. Balwa and Goenka strongly believe that Etisalat needs to be held responsible for their wrongful act.
Nonetheless, DB Realty is out of trouble. “No suit or claim has been filed against DB Realty since it was never party to any agreements or otherwise. DB Realty was and remains an independent corporate entity managed by a professional team,” the management said.