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| Sistema Shyam to sell 19.8% stake to Russia |
| BS Reporter / New Delhi Dec 11, 2009, 01:06 IST |
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Russian government to pay $676.9 million for the deal.
Sistema Shyam Teleservices (SSTL), a joint venture between Russia’s Sistema and India’s Shyam Group, today said it would sell a 19.8 per cent stake to the Russian government for $676.9 million (Rs 3,166 crore).
The company would issue 662.75 million shares, on a preferred basis, to the Russian Federal Agency at Rs 49.31 each. It will also issue up to 228.55 million shares to its Indian promoters at Rs 10 a share. The allotment of shares to the Indian promoters has been done to keep its total FDI below the government-mandated limit of 74 per cent.
The stake sale was approved today by the extraordinary general body meeting of the company’s shareholders. The proposal to sell shares to the Russian Federation was recently cleared by the Foreign Investment Promotion Board under the Ministry of Finance.
After the sale, Sistema’s stake will come down to 54.2 per cent, while Shyam Group will continue to have 23.5 per cent equity in the JV, which offers CDMA-based mobile services under the brand name MTS. Sistema currently owns 73.71 per cent in the venture.
“The new shareholding pattern will improve the financial stability of SSTL and will increase its share value. The funds will be used for further development of SSTL business in telecom circles of its current operation, as well as for network deployment in new regions,” SSTL CEO Vsevolod Rozanov said in a statement.
SSTL has licences and spectrum to provide mobile telecom services in all 22 circles across the country. It has a total subscriber base of about 2.8 million. Currently, it operates only in nine circles — Delhi, Kolkata, West Bengal, Rajasthan, Tamil Nadu, Kerala, Bihar, Jharkhand and Karnataka.
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