Spice Telecom, mobile service provider in Karnataka and Punjab circles, is expected to raise close to $250 million (Rs 1,000 crore) from a DBS (Development Bank of Singapore) led consortium over the next 24 months to fund its expansion plans. According to senior officials at Spice Telecom, the company is in talks with DBS-led consortium including Barclays and Deutsche Bank to raise funds for its Rs 2,000 crore expansion plan over the next two years. DBS had earlier arranged a $215 million debt for Telekom Malaysia, which picked up 49% stake in Spice Telecom in early March 2006. The bulk of this is being used to settle debts of Spice Telecom in the recent restructuring exercise announced by the company. Senior officials at the company also did not rule out the option of Telekom Malaysia increasing its stake upto 76% as per the telecom regulations in India. Telekom Malaysia picked up the 49% stake held by Ashmore Investments and Deutsche Bank in Spice Telecom for around $180 million.Spice Telecom has close to 2 million subscribers. In addition to its licenses in Karnataka and Punjab, it is also bidding for licenses in Jammu & Kashmir, Uttar Pradesh East, Uttar Pradesh West, Haryana, Himachal Pradesh and Rajasthan. Announcing the company's expansion plans, B K Modi, chairman, Spice Telecom said: "The entire restructuring of the company is complete. We have to look forward and invest in expanding the business. We intend to invest Rs 1,000 crore each in Karnataka and Punjab circles." Business is growing and funding will be done through internal accruals and external funding either through debt or equity. Taking the company public is another option we are exploring, Modi added.
