Sistema Shyam Teleservices (SSTL), the telecom JV between Russian operator Sistema and Indian conglomerate the Shyam Group, is considering a merger with one of India’s top seven telcos, according to SSTL’s Vsevolod Rozanov cited by the Economic…
Sistema Shyam Teleservices (SSTL), the telecom JV between Russian operator Sistema and Indian conglomerate the Shyam Group, is considering a merger with one of India’s top seven telcos, according to SSTL’s Vsevolod Rozanov cited by the Economic Times.
But he was quoted saying that the company was awaiting clearer deal regulation from the government before going ahead with a potential transaction. The company is also facing uncertainties regarding its licences in India in the wake of the 2G saga.
But a spokesperson for SSTL told TelecomFinance that the information had been misreported, and that the company was simply looking to grow the business and was reviewing all opportunities available, including M&As.
Late December last year, the Russian government invested about US$600m in Sistema Shyam Teleservices (SSTL) in return for a 17% stake in the company.
A statement explained that, following an additional share issue expected to take place in the first quarter of 2011, Sistema and the Russian government’s total stakes in SSTL’s ownership will not exceed the FDI cap. This rule states that a foreign company can not have a stake higher than 74% in an Indian telco unless it teams up with a domestic partner.
Sistema Shyam, which has licences in all of India’s 22 circles, will use the funds to expand its retail network and accelerate the launch of operations. The company is also planning an IPO in the coming months.
