VCCircle

Russian telecom services giant Sistema group may finally get a foothold in India. Sistema has reportedly acquired a majority stake in Shyam Telelink, an unlisted basic telecom services provider in Rajasthan, reports Business Standard. The company has apparently applied for telecom licenses nationwide on Tuesday, BS reports further. So Sistema is looking for a national presence through the acquisition. The report does not have any financial details.
Shyam Telelink, which operates fixed line and city mobile service under the brand Rainbow in Rajasthan, has 257,108 subscribers as of August-end this year. Shyam Telelink is part of the publicly listed Shyam Telecom group. The group had in 2004 sold its GSM service called Hexacom in in Rajasthan to Bharti Airtel. Shyam Telelink was expected to be listed last year, although the plans did not go through.
Shyam Telelink and Spice Telecom are the smallest players existing in the telecom business currently.
Update (27/09/07): The company has issued a statement saying that Sistema has picked up 10 per cent stake with an option to pick up more (41 per cent). It can also increase the stake up to 74 per cent, the FDI limit allowed in telecom business. The valuation of the company is $114 million, which is not bad for a single circle licence. Withthe acquisition, Sistema will get an edge over the new players who have applied for telecom licence in spectrum allocation.
Sistems had earlier tried to enter Indian market by acquiring a 49 per cent stake in Aircel. The deal did not go through. (See The Hindu Business Line).