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).
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.