09 Sep 2010
“India has a sad tradition of screwing these things up, creating uncertainty and making foreign companies think this is a tough place to do business,” private-equity investor John Band told the Journal. “Normally you pick a fight with the sellers, not with the buyers.”
The transaction involved Vodafone purchasing Cayman Islands firm CPG Limited, an entity controlled by Hutchison, and acquiring a further 15% of the company by taking up options on shares held by Indian investors.
But a new point of contention has arisen over whether the entire transaction is taxable, or just the acquisition of the shares held in India. This is likely to be the substance of Vodafone's appeal to the Supreme Court.