Shareholder row calls future of H3G into doubt

11 Jun 2003

Hutchison Whampoa is suing KPN over the GBP150 million the Dutch company refused to lend to their 3G mobile joint venture Hutchison 3G (H3G). Hutchison, the 65% shareholder in H3G, maintains that KPN broke a shareholder agreement by refusing to lend its part of a GBP1 billion loan requested by the venture’s board on 1 March. Hutchison Whampoa has confirmed that it has filed the lawsuit but has refused to comment any further other than to confirm that it will be seeking damages. KPN, which owns 15% of H3G, meanwhile maintains that H3G wasn’t entitled to the GBP1 billion loan because the board’s request was not valid. Hutchison Whampoa, which eventually paid KPN’s share of the loan, has asked the court to rule that KPN’s stake in H3G be diluted by GBP150 million as, it maintains, is specified in shareholder agreements. KPN’s participation in H3G has been under the microscope since it wrote down its participation in the company by EUR1.2 billion.