Partners squabble over 3's £1bn

NEWS The backers of mobile telco 3 are wheeling out the legal big guns in a fight over who's paying the £1bn bill for marketing and rolling out the 3G provider. And parent company Hutchison has had its debt rating cut by Standard & Poor's because of its mounting debt and the risks from its mobile investments. In one corner, Hutchison-Whampoa confirmed today that it was suing Dutch operator KPN Mobil in the High Court. In response, KPN says Hutchison has breached the shareholders agreement and therefore it should cough up for KPN's 15 per cent holding. The third 3 partner, NTT DoCoMo, is currently keeping very quiet. The story so far is that Hutchison 3G called on its shareholders for a £1bn loan to push its 3G services in the UK. Hutchison coughed up its £650m; DoCoMo put £200m in the pot, but KPN refused to contribute and Hutchison made up the £150m deficit. Hutchison is now after some money or some shares - and some damages. KPN claims that the request for funding is a 'purely voluntary invitation', and one which it had no difficulty refusing – it's only just getting back on the rails in Europe. But it also claims that the cash call breached shareholder agreements. So, it wants Hutchison to buy its 15 per cent stake for 140 per cent of its fair value as it claims it is entitled to do under the shareholders agreement. It's now up to the courts. S&P today said that it was cutting Hutchison-Whampoa's debt rating to A- from A, with a negative outlook – meaning that it expected to cut it further. Hutchison's legendary owner, tycoon Li Ka-Shing, cleared around $15m when he sold Orange to France Telecom. He's put most of it into mobile and 3G investments.