ZTE moves Mumbai court to recover dues from Loop Mobile

ZTE Corp, a Chinese telecom equipment vendor, has initiated legal proceedings Mumbai's oldest mobile operator Loop Mobile to recover dues to the tune of $25 million.

''It has come to our notice that Loop Mobile is entering into a business deal to transfer its operating assets (subscribers) to Bharti Airtel, without keeping us informed about this. To secure our business interests we have moved an additional application to the Bombay High Court for the recovery of dues,'' said Yuan Shen, attorney for ZTE.

ZTE has also wants Loop Mobile to deposit the amount, equivalent to the total claim, as fixed deposit or security deposit with the court.

Additionally, ZTE has requested the court to pass an order directing attachment of all sums payable by Bharti Airtel to Loop Mobile and restraining Loop Mobile to sell its business to any party without permission of the court.

ZTE is a publicly-listed global provider of telecommunications equipment and network solutions with the most comprehensive product range covering virtually every telecommunications sector, including wireless, access and bearer, VAS, terminals and professional services.

In February 2014, Bharti Airtel, the country's largest mobile operator by subscribers, acquired Loop Mobile for an undisclosed sum (See: Airtel confirms takeover of Loop Mobile; avoids disclosing deal size). The move strengthens the New Delhi-based company's presence in Mumbai metro, which has one of the largest revenue generating customers in the country. 

While the companies did not disclose the deal size, earlier media reports had pegged it at Rs 700 crore. The acquisition of Loop Mobile, a single circle operator with 3.2 million subscribers will the help the New Delhi-based operator gain a strong foothold in the Mumbai market.

Under the agreement, Loop Mobile's 3.2 million subscribers in Mumbai will join Bharti Airtel's more than 4 million subscribers.