Agrani Likely To Offload 74% To Foreign Allies

Agrani Satellite Services Ltd (ASSL), a subsidiary of Subhash Chandra-promoted ASC Enterprises Ltd which plans to build and manage communication satellites, is planning to off-load 74 per cent to a consortium of foreign investors including a strategic partner.

It has also indicated a project cost of Rs 1,197 crore ($245 million) which will be funded with a debt-equity ratio of 3:2. The amount of equity (Rs 478.8 crore or $98.1 million) comprises the equity capital of ASSL as well as the share premium, if any. IDBI has already issued a letter of intent offering a rupee term loan of Rs 300 crore for the project.

Sources said ASC has approached the foreign investment promotion board (FIPB) for converting the wholly owned subsidiary into a joint venture between ASC, the Indian partner holding a minimum 26 per cent stake, and Agrani Satcoms (Mauritius) Ltd, a subsidiary incorporated in Mauritius, and other foreign partners to be brought in subsequently together holding up to 74 per cent.

Though it has not indicated the names of the foreign investors, it has identified Alcatel Space Industries (ASI) of France as a vendor. The C- and Ku-band satellite proposed to be procured from ASI will be named Agrani-2 and is built around Alcatel's Spacebus satellite platform. It is identical to the Thaicom 3 satellite that was launched in April 1997 and is operating fully satisfactorily at 78.5 degree east.

Once the system is in place, ASSL proposes to market and lease satellite transponder capacities over India and neighbouring countries and to provide bundled solutions to meet the fast growing telecommunications, television, Internet and other multimedia requirements in the region, the company has stated in its application to the FIPB.

The Satcom policy announced by the department of space, permits a maximum 74 per cent shareholding in satellite operating companies.

ASC Enterprises was the first company to show interest in the satellite communication system owning and operating business, when in 1995 it obtained government approval to set up a joint venture with total FDI of $374 million to implement a GMPCS project. However, the project failed to take-off because of adverse business conditions.