Bahrain Telecommunications Co (Batelco), has signed an agreement to acquire 49% stake in Chennai based S Tel for $225 Million. Batelco is listed on the Bahrain Stock Exchange, and has the Bahrain Government as its principal shareholder. The S Tel acquisition has been made through Batelco Millennium India Company Ltd, a special purpose vehicle formed with Dubai based Millennium Private Equity. Prior to his, another Gulf based telco Etisalat had acquired 45% stake in Swan Telecom for $900 million. Swan's ownership is reportedly under investigation. $2.82 Billion Offer For Licenses To Operate In 16 Circles S Tel only has licenses to operate in 6 circles: Assam, Bihar, Himachal Pradesh, Jammu & Kashmir, North East and Orissa. However, the company has currently filed a petition for licenses to operate in the remaining 16 circles, and has offered to pay Rs. 13,572 crores (around $2.82 Billion) in all, for pan-India spectrum. The Department of Telecom has told the government that they are "actively considering" S-Tel's offer. So where is S Tel going to get the $2.82 Billion from? Batelco's $225 Million investment is probably for the 6 circles for which S Tel already has licenses, and we won't be surprised if additional money is pumped in to finance the license payout. Then, of course, there is the question of infrastructure rollout. We wonder why the Department of Telecom is offering licenses circle-wise, and not on a pan-India basis. That policy may have been right for a situation where companies perhaps wanted…
