April 10 India's Loop Telecom will close down
its operations and seek a 38 billion rupee ($740.81 million)
refund from the government, the Mint newspaper reported on
Tuesday, in the latest corporate fallout from a multi-billion
dollar corruption scandal.
India's Supreme Court in February ordered cancellation of
122 telecoms licences held by eight operators, including that of
Loop Telecom, because of alleged irregularities in the way they
were awarded in 2008.
A state auditor estimated New Delhi may have lost as much as
$34 billion as the permits were given out at "unbelievably low"
Loop will cease operations on May 15 and has demanded the
government refund its license fees plus interest, compensation
charges and bank guarantees, Mint reported, citing a letter to
the government signed by the company's managing director.
The move would affect only 6,000 subscribers and would not
impact Loop Mobile India Ltd, an associate that runs mobile
services in the city of Mumbai, the newspaper added.
Loop Telecom could not be reached by Reuters for comment. A
spokeswoman for Loop Mobile said that Loop Telecom would respect
the decision of the Supreme Court.
Loop would be the third casualty of the scandal and
subsequent investigation, after Abu Dhabi's Etisalat
said it would shut down its Indian operation and Bahrain's
Batelco, whose Indian joint venture is set to lose all
its six licences, agreed to sell its 43 percent stake.
($1 = 51.2950 Indian rupees)
(Reporting by Henry Foy in MUMBAI; Editing by Ranjit