Sistema's India unit seeks foreign investment limit hike
May 07 2014 , New Delhi
Govt had last year allowed foreign companies to fully own local telecommunications carriers, removing an earlier cap of 74%. But any stake increase beyond 49% in the telecom sector needs prior government approval.
Sistema and Russia's government together own nearly 74% in the unlisted Sistema Shyam joint venture, while India's Shyam Group has a 24% stake. The rest is owned by individual Indian investors.
A Sistema Shyam spokesman declined to comment beyond the company statement.
According to a copy of Sistema Shyam's application filed in March with the foreign investment regulator and seen by Reuters, the approval will enable conversion of preference shares in the company held by a Sistema unit into equity shares.
Sistema Shyam last year bought new telecommunication permits in an auction after its earlier permits were cancelled by court order on a broader licensing scandal. The company has said it is interested to buy more airwaves in the next auction and would need funding for that.