The $3-billion investment of Russian telecom operator Sistema in India hangs in the balance.
Sistema Shyam Teleservices is still in a bind about what should be its action plan after January 18. The CDMA operator is currently working on a “every day, every week basis” as it awaits the Supreme Court decision on the curative petition.
All its licences, except of Rajasthan circle, will expire January 18, because of a Supreme Court order passed in February, cancelling 122 telecom permits for alleged corruption in spectrum allocation.
It had filed a curative petition before the Supreme Court seeking restoration of its licences in May. But, it is yet to be listed for hearing.
“There is a Plan A, but no Plan B. We came here on government’s invitation. We need to understand what is the way out. At this stage, we see there is sympathy that we can continue, we need to see how,” Sistema Shyam Teleservices president and CEO Vsevolod Rozanov told reporters on the sidelines of Telecom Leadership Forum, 2012, on Thursday.
There is no panic situation to date and the company will continue to operate on “every day, every week basis”, until there is clarity, Rozanov said, adding, “The solution does not depend on me, but with people who do policies. It is a regulated sector.”
“The key thing that we are focusing on now is ensuring business continuity. I don’t have any other task now. If our licences are cancelled, then all the other things will be irrelevant. If I am unable to serve my customers after January 19, it doesn't matter what kind of opportunities I have. If we are not able to operate then it makes no sense,” said Rozanov.
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According to Rozanov, the timing of the hearing on its curative petition and its result will determine the next course of action.
Sistema Shyam which operates under MTS brand did not participate in the recent auction. However, it would “very seriously” consider participating in the next auction, if the government decides to conduct another auction at a reasonable price at the level of 2008 reserve price, said Rozanov. But, it would depend on the timing of the auction.
The government has already said that it would put 800 MHz CDMA spectrum on a fresh auction by March 31, 2013. It failed to get bidders for the 800 MHz airwaves during the recently concluded auction because oh high reserve price.
“There are 16 million customers, 7,000 jobs and three lakh retailers and a significant number of data customers with MTS. It is a humble appeal to the government and the court that there is speedy resolution to the matter because we are coming close to January 18 and no one knows what to do,” said Rozanov.
However, the company would not go for acquisitions right now. Rozanov said “there is no such plan as of now”.
During its results announcement last month, the company had said that it was open to acquisitions, but would only take a decision once it is assured that its investments in India are secured.