Citigroup hikes stake in VSNL to 6.3%

The world's largest financial services company Citigroup and its affiliates have scaled up their stake in Indian internet and telecommunications major Videsh Sanchar Nigam Ltd (VSNL) to 6.3 per cent from 1.5 per cent. The financial services major holds over 18.6 million shares of VSNL, after the acquisition.

The stake was acquired by way of VSNL's American depositary receipts (ADRs) listed on the New York Stock Exchange, Citigroup said in a filing with the US Securities and Exchange Commission (SEC).

VSNL officials refused to comment on the issue. According to industry sources, top brasses of VSNL were in the US during the past couple of weeks and were in discussions with investors.

However, it could not be confirmed whether the sale of ADRs was related to this. The Indian government holds around 26 per cent stake in company and the Tata group holds around 44 per cent stake, while the rest is held by mutual funds and the LIC.