Sistema Shyam Teleservices, which offers voice and data services on CDMA platform under MTS brand, has cleared a road block to be a 100% FDI funded company.
The shares of SSTL are owned by Sistema JSFC (56.68%), Russia Government (17.14%), India's Shyam Group (24%), other foreign entities (0.3%) and minority Indian stakeholders (2.05%). This minority shareholders filed an application seeking compulsory listing of shares of the company in a set time frame, an exit from the company at a pre-determined high price, and appointment of a representative of minority shareholders on the board of directors. The Rajasthan high court has dismissed the appeal.
Neera Sharma, executive director, legal, Sistema Shyam Teleservices said, "The order vindicates our stand that the company is committed to working in the interest of all shareholders, while maintaining highest standards of corporate ethics and governance,".
Also read: MTS Revises Prepaid Ultra (Rev B) Offerings
In September FIPB did not allow SSTL to increase its FDI beyond 74% (which is already present). Now as the new auction is coming, it's time to get more funding to acquire spectrum and expanding footprints. Fresh funds from Russia in the form of FDI would be beneficial for MTS India. Post auction SSTL is expected to reapply for increasing FDI.
