The Centre has given its approval to Janalakshmi Financial Services Ltd’s proposal allowing swap of shares involving its non-resident shareholders.
Sistem Shyam plan rejectedIt has, however, rejected Sistema Shyam Teleservice Ltd’s proposal to raise foreign shareholding in its downstream company to 100 per cent.
A decision was deferred on foreign direct investment (FDI) proposals made by five entities including Morgan Stanley India, Quintillion Business Media, Delbert Winn, Tikona Digital Networks and Netmagic Solutions, according to an official release circulated on Thursday.
The Finance Ministry’s decisions are in line with the recommendations of the Foreign Investment Promotion Board (FIPB) made in its meeting last month.
Apart from Sistema Shyam Teleservices’ (SSTL) proposal, three others including ones from Mount Kailash Shipping, Rev India and G4S Cash Solutions were rejected. Janalakshmi Financial Services (JFS), a non-banking financial company, had sought an approval for swap of shares whereby the non-resident shareholders of Janalakshmi will be issued shares in Jana Capital Ltd (JCL).
This would be in lieu of JFS shares being issued to JCL. The proposal, which did not include an infusion of fresh FDI, was approved by the government.
SSTL’s proposal to exit the resident shareholders and transfer their holdings to the existing foreign shareholders, Sistema Joint Stock Financial Corporation, Russia and Federal Agency for the State Property Management (Rosimushchestvo), was rejected by the government.
The proposal, if approved, would have increased the foreign shareholding in the company from 73.95 per cent to 100 per cent and consequently increased the foreign shareholding in SSTL’s downstream company, Shyam Internet Services Ltd, to 100 per cent.