(By Nikhil Pahwa & Vikas SN)
Singtel is looking to buy out its minority shareholders in Singtel Global (India) Pvt Ltd, and has filed for an approval with the Foreign Investment Promotion Board (FIPB), the Economic Times reports.
The proposed buyout is on the agenda for the meeting being held on October 18th by India’s Foreign Investment Promotion Board, but the details of Singtel’s proposal are not available yet. ET however reports that Singtel’s proposal relates to its India unit, Singtel Global (India) Pvt Ltd, in which Bharti Enterprises, the holding company of Bharti Airtel, owns 9.9% stake and Leela India owns 16.01% stake. Singtel owns the remaining 74% stake through SingTel Australia Holding Pte Ltd and INS Holdings.
If the deal is approved, Singtel will probably be the first foreign telco to buy out its Indian shareholders, after the government permitted 100% Foreign Direct Investment (FDI) in telecom in July 2013. Vodafone is also apparently in talks to buy out minority shareholders in Vodafone India for $2 billion.
Setup in 2007, Singtel Global India secured permits to provide national and international long distance telephony in 2009 and offers International network connectivity solutions to MNCs and Indian enterprises. This includes International calling and toll-free services, video conferencing solutions and virtual private network (VPN) based services.
It also provides managed connectivity solutions like IP PBX, application accelerator, managed hosting & security solutions and remote local area network (LAN) solutions. As of May 2012, Singtel India had seven access points – Pune, Mumbai, Bangalore, Hyderabad, Kolkata, Delhi, and Chennai and was looking to open new access points in Jaipur, Ahmedabad and Chandigarh.
Earlier this year, Singtel had also increased its Airtel stake to 32.34%, by buying 3.62% stake in Bharti Telecom for Rs 1859.25 crore and a MoneyControl report suggests that it is looking at a further stake hike in the company, by partly sponsoring Airtel’s bid in the upcoming 2G spectrum auctions.