The Russian government is to invest US$600m in Sistema Shyam Teleservices (SSTL), the Indian telecoms JV between Russian operator Sistema and Indian conglomerate Shyam Group, according to a Sistema press release.
There was no mention of the percentage…
The Russian government is to invest US$600m in Sistema Shyam Teleservices (SSTL), the Indian telecoms JV between Russian operator Sistema and Indian conglomerate Shyam Group, according to a Sistema press release.
There was no mention of the percentage the Russia government will get in return its investment, but previous reports pointed towards a 20% stake.
The investment deal between the Russian government and the operator is part of a scheme aimed at settling India’s outstanding debt with the former Soviet Union. Under an agreement between the two countries, Russia is able to use India’s outstanding debt, about US$1bn, to finance investments in India.
“SSTL plans to use the funds to be received from the share issuance to finance continued development of the company’s activities, in particular: the reinforcement of its leading position in the area of wireless broadband internet coverage, the expansion of its branded retail network in its current telecommunication circles, and the accelerated launch of operations in a number of new circles,” read the statement.
A decision on the investment was also required to allow SSTL to submit an IPO proposal, as it needs accurate information about its shareholding structure. Yesterday, local reports wrote that SSTL is close to deciding whether to list by the end of this year or the beginning of next year.
Sistema Shyam operates in 11 of India’s 22 telecom circles and has 6.5 million subscribers, according to Sistema.
