New Delhi: The Department of Telecom has `no objection` to the Russian government picking up 20 percent stake in telecom service provider Sistema-Shyam for a little over USD 676 million (Rs 3200 crore).
"SSTL (Sistema-Shyam Telecom Ltd) is permitted to bring
in foreign equity by issue of fresh shares as per the Lock-In
principles of the DoT," the department said, responding to a
Foreign Investment Promotion Board (FIPB) query where the
proposal has been pending.
A DoT note to the FIPB said SSTL has sought approval for
FDI up to 20 percent by the Federal Agency for State Property
of Russian Federation into the company by subscription of up
to 66.27 crore fresh equity shares of nominal value of Rs 10 a
share at the rate of Rs 49.31 per share approximately for an
investment of up to USD 676 million dollar.
The Indian promoters, it further said, have also proposed
to infuse additonal equity to keep 26 percent Indian
SSTL, currently operating in six circles, is in need of
huge funds for a pan-India expansion.
Post transfer of the equity by the Russian government,
Sistema`s holding in the JV will go down to about 54 percent.
Sistema will still have a majority stake and enjoy management
control of the company.
There will be no changes in the shareholding of Shyam,
which will continue to have a 26 percent equity in the JV.