Vsnl Approves 2:1 Bonus
Videsh Sanchar Nigam Ltd has announced an upward revision of its bonus issue of shares from 1:1 to 2:1 in order to meet the Rs 250 crore paid up equity capital eligibility criteria laid down by the government for acquiring licences in domestic long distance services. Post bonus issue the paid up capital of the company would be Rs 285 crore against Rs 190 crore from the earlier proposed 1:1 issue. The company has also announced its bandwith expansion plans with the procurement of additional Internet bandwith for its customers. Against an existing capacity of 331 mbps, with the fresh procurement the company's total bandwith would become 775 mbps. VSNL chairman and managing director S K Gupta said in a press statement, "The opening up of the DLD segment will create a new revenue stream for VSNL. Our investments in new technologies and infrastructure strongly position the company to take advantage of the emerging opportunities with the increasing liberalisation in the telecommunications sector." The government has laid down two essential criteria for acquiring licences to enter the DLD sector. While VSNL meets the first criteria of a Rs 500 crore networth, the second criteria of a Rs 250 crore paid up capital was proving to be a problem even after the 1:1 bonus issue approved by the board on July 27, 2000. Subsequently, the board revised its bonus issue proposal to 2:1. The additional bandwith capacity will be made available to customers within the next two months, ahead of its scheduled date of December 2000. The 'bandwith on demand' will be made available after October for 2 mbps bandwith on commissioning of the three STM-1 (totalling 465 mbps) links from India to the USA. The additional bandwith will help the company to clear all pending requirements of Internet bandwith demand. The board has also approved recommending to shareholders as increase in the companu's authorized share capital to Rs 300 crore from the existing Rs 100 crore. The company's latest data gateway has started functioning at Guwahati from August 20.