Government proposes National Security Exemption Act for mergers and acquisition issues
The National Security Council has proposed a National Security Exemption Act to empower the government to suspend/prohibit foreign acquisitions, mergers or takeovers of an Indian company that may be prejudicial to national interests. This follows criticism by the Prime Minister's Office (PMO) of Orascom Telecom's presence in Hutchison Essar as a potential threat to national security.
This is despite Hutchison Whampoa's clarifications that is has no intention of selling the majority equity stake in Hutchison Telecommunications International Limited (HTIL) to Orascom.
Orascom had reportedly expressed interest in increasing its stake in Hutchison Essar, which has a foothold in countries such as India and Vietnam.
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