Sistema Shyam Teleservices Ltd (SSTL), a joint venture between Russia’s Sistema and Shyam Group of India, has said it would raise about Rs 500 crore ($100 million) in April as direct loan from an Indian bank. Earlier, the management had mentioned its intention to raise around $400 million to fund its operations.
Sergey Savchenko, SSTL chief financial officer, said, ?We would receive Rs 500 crore through a direct loan in April 2010 and the rest would be raised in tranches this year.?
The firm has already raised about $1 billion, including $230 million through the external commercial borrowing route. The management intends to take its total investment in India to $2 billion by the end of 2010. Its aggregate investment till date is estimated to be around $ 1.5 billion, which was spent in acquiring spectrum and developing the network.
The Russian government is also expected to invest about $676 million for the 20% stake in SSTL. Sistema is seeking technical clarity from both the Russian and Indian governments. ?We expect the budget approval process to be completed by middle of this year as it get the clearances in the Russian parliament. The Russian government has always been supportive; so we expect to receive the funds this year,? said Savchenko. The Russian government will be utilising part of the rupee-rouble trade reserve balance of $2 billion in the Reserve Bank of India for procuring SSTL shares.
Currently, Sistema, which is owned by the Russian government, is the majority share holder in domestic mobile services provider with a 73.71% stake. The Shyam Group holds 23.79% and the rest 2.5% is held by the public. Under the Indian foreign direct investment norms, there is a cap of 74% for foreign investors in telecom ventures.