Sistema Shyam completes allotment of shares to Russian government agency

Russian oil-to-telecoms group Sistema's Indian mobile unit said today that it had completed allotment of shares to Russian government agency in return for a $600 million investment in the company.

With this Russian government's Federal Agency for State Property Management of the Russian Federation, or Rosimushchestvo  to come to acquire a 17.14 per cent stake Sistema Shyam, an Indian unit of Russia's OAO AFK Sistema.

Sistema Shyam said it issued 547.31 million new shares to Rosimushchestvo in addition to about 190.65 million shares to its local promoter--the Shyam group--and minority shareholders.

Unlisted Sistema Shyam TeleServices (SSTL) also said in a statement it had raised Rs1.94 billion ($43.3 million) in a rights issue to its shareholders, the Shyam Group and minority stake holders, before it allotted shares to the Russian agency.

According to Sistema Shyam the rights issue was to accommodate the foreign investment by the Russian government which is limited to a maximum of 74 per cent in telecom firms under Indian rules.

Post the share issue, the Russian government owns 17.1 per cent of SSTL, while Sistema's holding has shrunk to to 56.7 per cent from 73.7 per cent. The Shyam Group now owns about 24 per  cent of the company while the remainder 2.2 per cent is owned by minority public shareholders.