J. Sagar Associates (JSA) is advising Sistema Shyam Teleservices Limited (SSTL) and its majority shareholder Sistema JSFC, a leading Russian conglomerate (Sistema) in connection with the demerger of SSTL’s telecom wireless business operated under MTS brand to Reliance Communications Limited (RCOM) in exchange for 10% of the issued and paid up capital of RCOM. The Parties entered into definitive agreements in this regard on November 2, 2015.This deal is the first major consolidation in the Telecom sector since 2009, and is the first announced merger deal after the Department of Telecommunications came out with its merger guidelines in February 2014.Some of the salient aspects of the deal are: RCOM will acquire around 9 million subscribers and annual revenue of around Rs. 1.5 million; RCOM will acquire spectrum owned by SSTL in the 800-850 MHz band which is efficient for launching 4G LTE services; In consideration for the transfer, RCOM will issue and allot to SSTL 27,65,53,305 fully paid up equity shares comprising 10% of the issued and paid up capital; RCOM will take over SSTL liabilities towards installment payments to DoT for the spectrum SSTL acquired in 2013 auction; A payment / earn-out mechanism has been agreed in relation to disputed spectrum contiguity charges claimed by the DoT;… Read full this story
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JSA assists Sistema Shyam Teleservices Limited in demerger of SSTL’s wireless business to Reliance Communications Limited have 252 words, post on www.livelaw.in at November 8, 2015. This is cached page on Law Breaking News. If you want remove this page, please contact us.