MUMBAI, February 8: Birla AT&T, the 51:49 cellular services joint venture between the Adtiya Birla group and the US-based Telecom giant, AT&T, has offered the rupee fund of Asian Infrastructure Group (AIG) a stake in the company. According to sources, AIG is considering picking up a minority stake of about 10 per cent in the telecom company."We are studying their proposal of picking up a minority stake," said sources in Infrastructure Leasing & Financial Services (IL&FS), which manages the rupee fund.
This move follows Birla AT&T's reported consideration of infusing fresh funds in the range of Rs 400-500 crore into the venture through a combination of debt and equity. Besides, it is also understood that the company is looking at bringing a third partner into the venture.
The rupee fund of AIG presently has an investment corpus of about Rs 100 crore and the corpus will be expanded as and when the fund decides to increase its investments.
"We can increase the corpus after making fresh investments,"explained IL&FS sources. If AIG picks up a stake in the cellular company, this will be the first investment of the rupee fund in the telecom sector. The other funds of AIG have been invested in Indian telecom ventures such as Max Telecom Ventures Ltd, Tata Communications, BPL Cellular Holdings Ltd among others.
According to industry analysts, offering a minority stake to a fund like AIG is a logical step on the part of Birla AT&T as it will help in infusion of the much needed funds. "Besides, it will also help reduce the burden on the promoters of bringing in the required amount of equity," said an analyst.
At present, Birla AT&T's equity base is about Rs 813 crore and is expected to go up in the near future. The company has already contracted a $ 283 million loan lead managed by Bank of America and Toronto Dominion Bank.
Birla AT&T is one of the two licence holders for providing cellular service in Gujarat and Maharashtra (inclusive of Goa and excluding Mumbai) and has already started its services.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
