RCom gets another nod for MTS acquisition, may close deal in November

Reliance Communications (RCom) said that it has received a nod from the Bombay High Court for the acquisition of Russian conglomerate Sistema’s Indian telecom unit, Sistema Shyam Teleservices Ltd (SSTL).

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Following this nod, RCom will now approach the telecom department for the final approval for the acquisition. Media reports said that the acquisition is expected to be closed by November 2016.

“We wish to inform you that Hon’ble High Court of Judicature at Bombay has today sanctioned the Scheme of Arrangement between the Company and Sistema Shyam Teleservices Limited (SSTL) and their respective shareholders and creditors (Scheme) pursuant to the petition filed by the Company,” the company said in a filing to stock exchanges.

Both the parties have already received approval on the Scheme of Arrangement the Rajasthan High Court.

The all-stock acquisition was announced in November 2015, and is valued at around Rs 4,500 crore, which will create an operator with 118 million subscribers. As per the deal, SSTL will hold about 10 per cent stake in RCom and pay off its existing debt before closing the deal.

The deal will give RCom access to spectrum or airwaves in the 850 Mhz band that can be used for 4G services which it plans to start by the year-end. The acquisition will allow RCom to extend the validity of its licence by 12 years in eight high revenue-generating — Delhi, Gujarat, Tamil Nadu, Karnataka, Kerala, Kolkata, UP (West) and West Bengal.

SSTL, which operates under the MTS India brand, is currently offering voice and data services across nine telecom circles in the country.

AFK Sistema currently holds 56.68 per cent stake in SSTL, while the Russian government owns 17.14 per cent interest. Shyam Group has 23.98 per cent stake and the rest is owned by small investors.

RCom is also in the process of merging its wireless operations with Maxis-owned Aircel to create a new merged entity.

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25 Comments on "RCom gets another nod for MTS acquisition, may close deal in November"

 

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[…] per the deal, SSTL will hold about 10 per cent stake in RCom and pay off its existing debt before closing the […]

vinay
October 9, 2016 12:57 am 12:57 AM

expect mts to shut services soon so dat all its high revenue customers ll hv to migrate to anothr wireless data provider, jio ll get d biggest benefits of this deal as most mts customers ll think to move to it . its planned well by d 2 brothers

Tapoo
October 9, 2016 12:09 am 12:09 AM
Long time customer of MTS’s from their service launch. Sad, but truth is CDMA is a dying technology, as no company is taking it seriously. If you want to purchase a new CDMA handset, you have to depend on some unknown brands as reputed brands already stopped their CDMA handset production. MTS is merging with Reliance and Aircel, both are reputed for their stealing technique from customers X| . As a MTS customer from service launch and from experience from other longs time MTS users, i can say that they haven’t stole from users like Reliance and Aircel. Looks like,… Read more »
Amit
February 7, 2017 6:58 pm 6:58 PM

CDMA tech. Technology dont have any future in India .

Kaushik
October 11, 2016 9:15 am 9:15 AM

Gionee s6 pro supports both CDMA and GSM. Just try it with Tata CDMA.

Devraj Khatri
October 10, 2016 12:49 am 12:49 AM
If you see the VLR reports of RCOM after their GSM 4G forced transformation, you can see more than five million CDMA customers ported out of Reliance forever. So Reliance CDMA customers do not exist anymore. Reliance will further get into severe loss because they could not sell their CDMA hardware valued at Rs 23000 cr. They will lose millions of customers of MTS if they make that similar blunder. Today we were testing BSNL CDMA and Tata CDMA coverage in Western Maharashtra near Palghar and we were delighted to see that most cell sites covered more than ten kilometers… Read more »
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