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Reliance Communications and Russia's <keyword id="6368074" type="COMPANY" weightage="60" keywordseo="Sistema">Sistema</keyword> are considering the feasibility of a merger through a stock swap. 
 
"The discussions are indicative and non-binding in nature, and remain subject to due diligence, definitive documentation and approvals, as may be necessary," Reliance Communications said in a media statement on Monday. 
 
"There is no certainty that any transaction will result," the statement added. 
 
The Ambani-owned Reliance Telecom was earlier reported to be in talks on a possible takeover of SSTL, a unit of Russia's Sisterma JSFC, in an all-stock deal. 
 
Sistema Shyam has reportedly said it agrees with the Reliance’s official statement. 
 
(Image credit: Indiatimes)

Reliance Communications is looking to merge with Sistema
Shyam

In a major development, <keyword id="351012" type="PERSON" weightage="80" keywordseo="Anil-Ambani-owned">Anil Ambani-owned</keyword> <keyword id="46907" type="CITY" weightage="80" keywordseo="Reliance-communications">Reliance Communications</keyword> is planning to takeover <keyword id="6368074" type="COMPANY" weightage="80" keywordseo="Sistema">Sistema</keyword> Shyam Teleservices (SSTL) in an all-stock deal reportedly which could give the Russian-owned telco's shareholders less stake in the merged entity. 
 
However, Reliance Communications and SSTL, majority owned by Russia's Sistema JSFC, do not want to comment on the possible takeover. 
 
"Due diligence is currently on, and there is an effort to tie up details in the next two to three months," a person directly involved in the talks told the Economic Times. 
 
"The second phase of the deal, if it happens, may see Sistema (JSFC) infuse more funds to raise its stake in the new entity, which can be used for capex or pare debt," he said. 
 However, another person familiar with the developments said there's no certainty about the deal. "Talks are going on. The top leadership of both the companies have met, but there are a lot of variables at play," he said, adding "any deal will need legal clearances, in addition to a nod from the DoT (<keyword id="116246" type="ORGANIZATION" weightage="80" keywordseo="Department-of-Telecommunications">Department of Telecommunications</keyword>)." 
 
According to Sistema, the company had held talks with other telecom operators in India, including Reliance Communications, for business expansion. 
 Sistema JSFC holds nearly 57 % in Sistema Shyam, which offers telecom services under the <keyword id="510271" type="UNKNOWN" weightage="80" keywordseo="MTS-brand">MTS brand</keyword> using <keyword id="218695" type="TECHNOLOGY" weightage="80" keywordseo="CDMA-technology">CDMA technology</keyword> in nine of India's 22 service areas to nearly nine million subscribers. Other shareholders include the Russian government with over 17 % and <keyword id="124887" type="CITY" weightage="60" keywordseo="Shyam-Group">Shyam Group</keyword>, the Indian promoters of SSTL, holding 24 %. Minority shareholders own the rest. 
 
Sistema entered India in 2007. In 2008, the joint venture was awarded licences and spectrum to offer telecom services in all of India's 22 circles using CDMA technology. Sistema gradually raised its stake in the joint venture. 
 
(Image: Indiatimes)

Reliance Communications is eyeing Sistema Shyam Teleservices

The proposed merger of <keyword id="178358" type="COMPANY" weightage="100" keywordseo="Sistema-Shyam">Sistema Shyam</keyword> Teleservices Limited and <keyword id="46907" type="CITY" weightage="100" keywordseo="Reliance-communications">Reliance Communications</keyword> has been approved by the Competition Commission of India (CCI). Since 2009, this will be the first major amalgamation to happen in this intensely competitive sector. 
 
As per ET reports, Reliance Communications and SSTL were in talks for a possible takeover in an all-stock deal which is expected to be worth around Rs 4,500-5,000 crore. The deal would give SSTL’s shareholders a stake of around 10% in the merged entity. 
 
As per the deal, Reliance would have access to airwaves in the 850 Mhz band which will be most probably be used for its forthcoming 4G services. The validity of its licenses in eight high-revenue generating circles like Delhi, Gujarat, Karnataka and Tamil Nadu will also be extended by 12 years. SSTL, on the other hand, will get to be a part of a stronger company and will finally be able to expand its CDMA-based business. 
 SSTL is the Indian telecom unit of Russia's <keyword id="478745" type="COMPANY" weightage="100" keywordseo="Sistema-JSFC">Sistema JSFC</keyword>. 
 
<a href="http://www.odishanewsinsight.com/wp-content/uploads/2015/11/Reliance-Anil-Ambani.jpg">Image source</a>

RCom and SSTL merger gets CCI stamp

In the biggest ever spectrum auction that may fetch the government nearly Rs 1 lakh crore, <keyword id="15491" type="COMPANY" weightage="20" keywordseo="Airtel">Airtel</keyword>, <keyword id="15492" type="CITY" weightage="20" keywordseo="Vodafone">Vodafone</keyword>, <keyword id="6354924" type="PERSON" weightage="20" keywordseo="Idea-Cellular">Idea Cellular</keyword>, <keyword id="46907" type="CITY" weightage="20" keywordseo="Reliance-communications">Reliance Communications</keyword>, Aircel, Reliance Jio Infocom, Uninor and Tata Teleservices are the eight telecom companies which are competing to buy the second-generation or 2G and third-generation 3G radiowaves, as per a PTI report. 
 
The auction is scheduled to start from March 4. 
 However, <keyword id="83213" type="COMPANY" weightage="20" keywordseo="Sistema-Shyam-Teleservices-Ltd">Sistema Shyam Teleservices Ltd</keyword> (SSTL) cited high price and legal issues with the <keyword id="62528" type="ORGANIZATION" weightage="20" keywordseo="Department-of-Telecom">Department of Telecom</keyword> (DoT) to opt out of the auction. SSTL is a potential buyer of CDMA spectrum, On the other hand, Gurgaon-headquartered <keyword id="262458" type="COMPANY" weightage="20" keywordseo="Videocon-Telecom">Videocon Telecom</keyword> did not submit its application to participate in the auction, a PTI report revealed. 
 Currently, most of the spectrum that is available for the auction is held by Idea Cellular, Vodafone, <keyword id="107841" type="CITY" weightage="20" keywordseo="Reliance-Telecom">Reliance Telecom</keyword> and Airtel, and their licences are expiring in 2015-16. 
 
According to the PTI report, 9 circles of Mumbai-headquartered Idea Cellular, 7 circles each of Vodafone and Reliance Telecom, and 6 circles of Airtel are coming up for renewal. In total, there are 29 spectrum licences expire in 18 service areas in 2015-16. 
 
If these telecom firm wish to continues offering their services to the customers, it is mandatory for them to bid for spectrum. So it would be interesting to see who gets what on March 4. 
(Image: BCCL)

Eight telcos to compete in spectrum auction race

Anil Ambani-led Reliance Communication (<keyword id="6368075" type="CITY" weightage="20" keywordseo="RCom">RCom</keyword>) and <keyword id="2902530" type="UNKNOWN" weightage="20" keywordseo="Russian-conglomerate-Sistema">Russian conglomerate Sistema</keyword> on Tuesday announced that they have entered into exclusive discussions for a potential merger of their Indian telecom businesses via a stock swap. This information was revealed in an Economic Times report. 
 
Investopedia defines that stock swap is “the exchange of one asset for another. A stock swap occurs when shareholders' ownership of the target company's shares are exchanged for shares of the acquiring company as part of a merger or acquisition. During a stock swap, each company's shares must be accurately valued in order to determine a fair swap ratio.” 
 Analysts believe that the possible merger with <keyword id="6368074" type="COMPANY" weightage="20" keywordseo="Sistema">Sistema</keyword> Shyam TeleServices (SSTL) can help the debt-ridden <keyword id="46907" type="CITY" weightage="20" keywordseo="Reliance-communications">Reliance Communications</keyword> get access to spectrum, as per financial daily. 
 
"The discussions are indicative and non-binding in nature, and remain subject to due diligence, definitive documentation and approvals, as may be necessary. There is no certainty that any transaction will result," as per a statement issued by RCom. 
 
This announcement is of extreme importance for RCom shareholders. Sudip Bandyopadhyay, president, Destimoney Securities, told ET Now, “RCom's spectrum licence will expire sometime in 2017, whereas the Sistema's licence in India, which they have paid for partially and acquired one-one and a half years back, is there for 20 years." 
(Image: The Economic Times)

Anil Ambani has new tricks up his sleeves to save his telecom business

New Delhi, Feb 14 () As the sword of Damocles hangs over Vodafone Idea, uncertainty continues to mire the Indian telecom sector which has seen fall of several telcos such as Etisalat DB, Reliance Communications, Sistema Shyam and Aircel. The Supreme Court on October 24, 2019, ruled that statutory dues need to be calculated by including non-telecom revenues in AGR of telcos, leading to huge liabilities of Rs 1.47 lakh crore for telcos already hit by falling revenues due to fierce competition. After facing the ire of the Supreme Court, the Department of Telecommunications asked telecom licence holders to clear entire AGR dues totalling Rs 1.47 lakh crore by the end of Friday. Vodafone Idea Ltd (VIL), whose liability is estimated to be around Rs 53,038 crore including Rs 24,729 crore of spectrum dues and Rs 28,309 crore in licence fee, has already warned of shutdown if no relief is given. In this matter, Bharti Airtel's liabilities as per last available estimates added up to nearly Rs 35,586 crore, including licence fee and spectrum usage charge dues, Tata Teleservices around Rs 10,000 crore, Telenor (which sold spectrum to Airtel) Rs 1,950 crore. BofA Securities, in a note on Friday, noted "overhang on VIL" and questioned if India is inching towards a two-player market. "Every incremental decision pushes India to a two-telco market," it added. Market watchers, meanwhile, said in the event of any further consolidation in the market, the tariffs could well rise by 10-25 per cent. Vodafone Idea Chairman Kumar Mangalam Birla has said it will shut down business if the company has to pay the entire adjusted gross revenue amount and the government does not come to its rescue. Vodafone Group has said it will not pump in any fresh capital into Vodafone Idea. If the Aditya Birla group subsidiary shuts shop, Vodafone India will be the second-large company after Jet Airways to go belly up under the Prime Minister Narendra Modi government. Vodafone Idea's gross debt, excluding lease liabilities, was Rs 1,15,850 crore as on December 31, 2019, including deferred spectrum payment obligations due to the government of Rs 88,530 crore. There were 13 telecom operators in the market when the Modi-led NDA government came to power in May 2014 but the companies started folding up due to market conditions and rising regulatory costs. Vodafone Group CEO Nick Read last year alleged that British telecom major Vodafone on Monday alleged that regulatory outcomes in India over the past two years have been against every telecom operator, except Reliance Jio. Vodafone Idea has claimed to have invested over 3.1 lakh crore in India which includes 1.39 lakh crore for spectrum payment. The uncertainty around Vodafone Idea has also put risk over jobs of 11,700 direct employees and around 1 lakh indirect jobs. According to Reliance Communications Chairman Anil Ambani, there have been around 20 lakh job losses in the telecom sector. His firm amalgamated mobile business of Russian Conglomerate Sistema-owned SSTL to mitigate the debt burden due to lower margin in the capital-intensive telecom vertical. Later, RCom failed to merge business with Aircel and now both the companies are going through an insolvency process. According to official data, the telecom sector's gross revenue fell about Rs 41,000 crore in three years on account of a dip in mobile services rates between 2016-17 and 2018-19 and the adjusted gross revenue on which the government earns revenue, also declined by around Rs 46,000 crore. PRS ANZ MR

Vodafone Idea faces uncertain future over AGR woes

In a long debated war over net neutrality, Sistema Shyam Teleservices better known as MTS, has emerged as the first telecom operator to openly break ranks with peers by encouraging subscribers to make national and international long-distance calls using any OTT (over the top) voice services app, be it Skype, WhatsApp, Viber, Google Chat, Messenger or Facebook. 
 
While Bharti Airtel, Vodafone India and Idea Cellular are battling OTT voice service providers, which they fear will impact the voice, this move by Indian unit of Russia's Sistema JSFC is certainly a big news for the people opting for this kind of communication. 
 
A highly placed source in Sistema Shyam executive said that the CDMA operator's subscribers would pay 50-75% less for national and international Internet calls using VoIP apps, compared with similar calls made on regular mobile networks. The move is aimed at bolstering the company's voice-centric data services business model. 
 
Lately, Sistema Shyam has been focusing more on data services, with more than 55% of its quarterly revenue stemming from the non-voice business. The latest emphasis on Internet calling plans is aimed at growing its data earnings and hedge potential revenue expansion risks by virtue of the company's airwave holdings in just nine circles, especially since it didn't buy CDMA airwaves in the 800-MHz band in the March 2015 spectrum sale. 
 
"Sistema Shyam doesn't support any discrimination when it comes to Internet services, and our latest plans give customers the freedom to use data purely for Internet calls if they wish," said the executive. 
 
In July, a telecom department panel on net neutrality proposed regulating local and national long-distance calls made using OTT voice apps like Skype, Viber, WhatsApp and Google Chat to create a level playing field between telcos and OTT providers. 
 
But a Sistema Shyam executive said "the recommended restriction on domestic long-distance calls made using VoIP services," would only apply "to Internet service providers", and not regular mobile operators holding unified licences. Sistema Shyam plans to offer Internet calling service as a unified permit holder, which allows it to offer various communication services, including 4G, on the spectrum it holds. 
 
Amid the net neutrality debate, Sistema Shyam had in August openly took a stance against established telcos such as Bharti Airtel and objected to zero-rating tariffs.

​Good news in net neutrality debate: MTS rolls out plan for Skype and Whatsapp calls

<a href="http://www.businessinsider.in/searchresult.cms?query=Reliance+Communications">Reliance Communications</a>, Sistema Shyam Teleservices and Aircel together is not only likely to have a 3G footprint that is bigger than those of <keyword id="15492" type="CITY" weightage="20" keywordseo="Vodafone">Vodafone</keyword> and <a href="http://www.businessinsider.in/searchresult.cms?query=Idea+Cellular">Idea Cellular</a>, analysts say, but is also expected to have 4G presence in eight circles. 
 
This comes after Anil Ambani-controlled RCom and Aircel on Tuesday announced exclusive 90-day merger talks to combine their wireless businesses under a newly listed Rs 35,000 crore entity, barely a month after RCom, India's fourth-largest carrier, and the Indian unit of Russia's Sistema JSFC announced an all-stock merger. 
 
Brokerage IDFC however pointed out one problem in the setup. It said the combined wireless operations of "RCom, Sistema Shyam and <a href="http://www.businessinsider.in/searchresult.cms?query=Aircel+">Aircel </a>would have a formidable 12 per cent revenue market share, but the debt burden of both RCom (Rs 39,900 crore) and Aircel (Rs 20k-to-24k crore range) could be a possible deal breaker." 
 Meanwhile, in a note to clients, <keyword id="6361649" type="CITY" weightage="20" keywordseo="Goldman-Sachs">Goldman Sachs</keyword> said on Wednesday: "A combined entity could offer 3G services in 18 circles, launch <keyword id="6493730" type="UNKNOWN" weightage="20" keywordseo="4G-services">4G services</keyword> on the 2300 MHz band in eight circles and hold 2G spectrum in 22 circles." 
 
The US brokerage noted that the potential combine would "breach overall spectrum caps in Tamil Nadu, West Bengal and Jammu &amp; Kashmir. Operators are not allowed to hold more than 25% of the total spectrum in a circle. People familiar with the matter said the new entity may surrender excess airwaves.” 
 
(Image credits: BCCL)

RCom, Aircel, SSTL merger likely to create strong number 4 after Airtel,Vodafone, Idea

TRAI’s directive on ensuring minimum speed of 512 kbps download speed at all times has upset telecoms. 
 Bharti <keyword id="15491" type="COMPANY" weightage="20" keywordseo="Airtel">Airtel</keyword>, <keyword id="46907" type="CITY" weightage="20" keywordseo="Reliance-communications">Reliance Communications</keyword> and Sistema Shyam Teleservices have said that customers cannot be accessing data even after exhausting their packages. 
 
Bharti Airtel, in its submission to the Telecom Regulatory Authority of India (TRAI), said it cannot be the prerogative of the customer to keep accessing data at the defined broadband speed even beyond the assigned quota. 
 
"If broadband has to become affordable, the authority should not mandate any broadband speed after exhaustion of (data) quota," said Bharti Airtel. 
 
Reliance Communications also echoed the same sentiments, saying the service provider should have the freedom to throttle speeds. 
TRAI had asked broadband operators to ensure download speeds do not drop below 512 kbps in any tariff plan. 
 
The Cellular Operators Association of India and Association of Unified Telecom Service Providers of India (Auspi) also called for an immediate revision of the clause. 
 
(Image: Thinkstock)

TRAI’s directive on minimum net speed upsets Airtel, Reliance

Come December, Ambani brothers would be operating their telecom businesses together. They have already intimidated the telecom department (DoT) about their intention to share airwaves and offer 4G services in 10 key markets. 
 
Mumbai, Madhya Pradesh, Bihar, UP-East, Haryana, Himachal Pradesh, Odisha, Assam, Northeast and Jammu &amp; Kashmir would experience the historical CDMA band of 800-850 MHz. This would collectively make up more than 35% of overall pan-India telecom revenues for the Anil Ambani-owned RCom and Mukesh -owned Reliance Jio, as informed in the news report by The Economic Times. 
 
The spectrum sharing and trading pacts signal the increasing cooperation in the telecom space between the two brothers. With such pacts, and with a complete passive infrastructure sharing pact in the bag, which involves sharing towers and optic fibre, RCom and Jio are operating as all but one company. 
 
"This overall strategic cooperation and partnership between Reliance Jio and Reliance Communications is a virtual consolidation in the telecom sector," Anil Ambani had recently said at his company's most recent annual meeting. 
 
The cooperation would entail maintenance and servicing of infrastructure, common network operating centres, data centres, content and retail outlets, people familiar with the plans said. 
 
The architects of the Jio telecom plans majorly overlap with founding team of Reliance Communications, which was started under the patriarch Dhirubhai Ambani. Subsequently, during the split of the RIL empire in 2006, many members of the founding team joined Mukesh Ambani, who had signed a non-compete agreement in the businesses he ceded to his younger brother. The non-compete agreement was revoked in 2010, the year when Reliance Industries re-entered the telecom space. 
 
The pacts now done, one important piece in the plan is RCom's talks to merge Sistema Shyam Teleservices, which is a pureplay CDMA operator, with itself, discussions for which are at an advanced stage and could even close in a couple of months, the ET report said. 
Sistema, with its 10 million subscribers across nine service areas, has airwaves in the 800MHz band, which are considered ideal for 4G services. The bandwidth that RCom is using for its CDMA and ones that Jio has bought in the 800MHz band are largely continuous. This means, the ET says, the RCom must free as much of that for the two companies to have a better 4G rollout. 
 
RCom has 3G (2100 MHz) airwaves in 13 circles, 800 MHz in 19 and 1800 MHz (traditionally used for 2G) in all 22 circles. 
 
For the entire combination to work involves more careful stitching up of networks. A person said this has translated into Jio focussing on fewer number of cities for its initial launch likely in December. The company had earlier intended to start in 200 cities, but is now focusing on around 50. 
 
RCom has already applied with DoT to liberalise its old 800 MHz spectrum holdings in eight of the 10 circles that they will share with Jio, which will cost nearly.'2,000 crore. It already has liberalised 800 MHz airwaves in Assam and Northeast. It will shortly apply for liberalising its balance old 800 MHz spectrum holdings in the remaining 12 circles.

4G brings Ambani brothers together

Seems like we are on track with the <keyword id="44528" type="ORGANIZATION" weightage="100" keywordseo="FDI">FDI</keyword> structuring in India. FDI is high on the list of the new <keyword id="6360789" type="ORGANIZATION" weightage="80" keywordseo="Modi-Government">Modi government</keyword> and today the <keyword id="62529" type="ORGANIZATION" weightage="100" keywordseo="Foreign-Investment-Promotion-Board">Foreign Investment Promotion Board</keyword> (FIPB) cleared a lot of FDI proposals. This comes as good news for many foreign and Indian companies as they have been waiting to get the sign off from the <keyword id="44734" type="ORGANIZATION" weightage="60" keywordseo="Indian-Government">Indian government</keyword> for the <keyword id="6362476" type="ORGANIZATION" weightage="100" keywordseo="investments">investments</keyword>. 
 The committee was handed a list of 35 proposals in various sectors and by multiple companies, out of which FIPB gave the go ahead to 21 of them. Bharti shipyard was the lucky one to get the go from the board, whereas Sistema Shyam’s request to raise foreign holdings was denied. Others who got the right to pass is <keyword id="6393116" type="CITY" weightage="80" keywordseo="Verizon">Verizon</keyword> who got 100% FDI approved, Kineco Kaman Composites India in the defence sector and ANZ capital in <keyword id="25455" type="ORGANIZATION" weightage="60" keywordseo="finance">finance</keyword> sector. 
 This should give a boost to the <keyword id="6356076" type="UNKNOWN" weightage="60" keywordseo="indian-economy">Indian economy</keyword>, which is slowly yet steadily rising. The move will also give more confidence to foreign investors. 
 
Image: Thinkstock

You Searched For "Sistema Shyam" and got 11 results

Reliance Communications is looking to merge with Sistema Shyam

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You Searched For "Sistema Shyam" and got 11 results

Reliance Communications is looking to merge with Sistema Shyam

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Good news in net neutrality debate: MTS rolls out plan for Skype and Whatsapp calls