The Reserve Bank of India (RBI) last month informed the Finance Ministry that it was "inclined to accept" the proposal of Tata to buy DoCoMo's 26.5 percent stake at Rs. 58 per share, half the rate which the Japanese firm originally paid.
Sources said the central bank said the "structure of the contract is such that the investor, in any circumstances, if it intends to exit, will receive at least Rs. 58.045 or higher per share."
As per RBI norms, the non-resident investor is not guaranteed any assured exit price at the time of making such investment and shall exit at a fair price computed as above at the time of exit.
Taking into account RBI norms, the structure of contract between Tata Sons and NTT Docomo is not in line with the provisions as the fair value of shares is Rs. 23.34 per share.
However, sources said the RBI is of the view that larger issue here is of a fair commitment in the contracts in relation to an investment and a downside protection of an investment, rather than an assured return.
"Besides, our strategic relationship with Japan in recent times in relation to FDI flows is also a matter to be kept in view. In view of this, we are inclined to accept the proposal and in future, in all such cases, similar principal shall be applied," RBI is believed to have said to the Finance Ministry.
RBI has sought the Finance Ministry's views on it, sources said.
When contacted, a Tata Sons spokesperson said, "As you are aware, Tata Sons has made the necessary application to the Reserve Bank of India. The company is awaiting a response."
The exit, it had said, was to happen as per the 2009 agreement with Tatas when the Japanese firm invested $2.2 billion (roughly Rs. 13,678 crores) in Tata Teleservices. As per the agreement, it was to get the higher of either half the original investment or a fair value.
Tata Sons has engaged PwC to determine the fair value in relation to the equity shares of Tata Teleservices Ltd and as per their report, the fair value of the eligible shares was Rs. 23.34 per share.
Unable to find a buyer, Tata Sons in November applied to RBI to purchase the stake at Rs. 58.045 per share - half the price DoCoMo had paid in 2009.
But it could not get the requisite approvals in time and DoCoMo earlier this month dragged Tatas to an international court of arbitration.
The Japanese firm had stated that as per the 2009 agreement that formed Tata Teleservices, Docomo can sell the shares if the joint venture fails to meet performance targets in the fiscal year that ended on March 31 last year.
Docomo, TTSL and Tata Sons had in March 2009 signed shareholder agreement for business alliance. Docomo picked up 27.31 percent stake in Tata Teleservices for Rs. 12,924 crores and 20.25 percent in Tata Teleservices (Maharashtra) Ltd - the listed arm of TTSL - for Rs. 949 crores. Overall, Docomo holds 26.5 percent in Tata Teleservices.