The shareholders of Sistema Shyam Teleservices (SSTL), the telecom JV between Russian financial group Sistema and Indian conglomerate Shyam Group, have approved a plan to raise Rs60bn (US$1.17bn) via the issue of preferred shares.
As a result, the…
The shareholders of Sistema Shyam Teleservices (SSTL), the telecom JV between Russian financial group Sistema and Indian conglomerate Shyam Group, have approved a plan to raise Rs60bn (US$1.17bn) via the issue of preferred shares.
As a result, the company’s authorised capital has increased to Rs120bn (US$2.34bn).
“The preference shares are non-convertible and redeemable,” SSTL said in an emailed statement today.
“The increase in authorised capital base provides SSTL with the added flexibility to raise finances for its rapidly expanding business operations across the country. It may also be noted that there is no change in the equity structure of the company,” it added.
Early this year, SSTL, which operates under the MTS India brand, had raised a Rs12.8bn (US$248m) loan through non-convertible debentures.
The company has been looking to launch an IPO for several months now. But the recent cancellation of its 21 2G licences following a Supreme Court ruling in early February is likely to further delay this plan.
Sistema, which owns a 56.68% stake in SSTL, said, at the time, it “believes that the cancellation of SSTL’s licences following Sistema’s investment of billions of dollars into the Indian cellular sector is contrary to India’s obligations under the BIT [Bilateral Investment Treaty between Russia and India].”
The Russian company added that if the dispute was not resolved by the end of August 2012, it would consider commencing proceedings against the Indian government as provided in the BIT.