Sistema Shyam Teleservices (SSTL), the telecom JV between Russian operator Sistema and Indian conglomerate the Shyam Group, has completed the allotment of about 547 million shares to the Russian government in return for the US$600m the country invested…
Sistema Shyam Teleservices (SSTL), the telecom JV between Russian operator Sistema and Indian conglomerate the Shyam Group, has completed the allotment of about 547 million shares to the Russian government in return for the US$600m the country invested in the company in December 2010.
The Russian federation now owns 17.14% of SSTL, while Sistema controls 56.68% of it. Together they control just under 74% of the company, as requested under the foreign direct investment (FDI) cap. The remaining shares are held by the Shyam group (23.98%) and the public (2.2%).
The company explained that the stand-up capital of the joint venture now stands at Rs31.94bn (US$716m), including the 190 million shares allotted to existing shareholders, such as the Shyam Group. It plans to use the funds to expand its services across India.
In a statement, Vsevolod Rozanov, president and CEO of SSTL, said: “Going forward, the challenge is to further accelerate the proliferation of our telecom services nationally, in sync with our data centric, voice enabled strategy.”
This investment was part of a scheme aimed at settling India’s US$1bn outstanding debt with the former Soviet Union by financing investments in India.
SSTL, which operates under the MTS brand, needed a decision on the investment before it can submit an IPO proposal, as it required accurate information about its shareholding structure.
A couple of weeks ago, it was reported that SSTL would appoint banks within the next couple of months to advise it on its listing. In an email to TelecomFinance at the time, SSTL confirmed that it is considering appointing bankers for its planned listing but added that it was too early for the company to be more concrete about the process.
