• SEBI replaces DIP Guidelines with Issue of Capital and Disclosure Requirements Regulations
• CBDT panel to review new tax code
• Disinvestment to come through FPOs, not IPOs
• Panel to speed up closure of sick companies
• Sistema Shyam goes back to FIPB
• MTNL bids for Nigerian telco
• American Tower Corp eyeing more acquisitions in India
• CBDT has formed an internal committee to review the provisions of the draft Bill. The committee, which includes CBDT officials dealing with investigation, assessment, foreign tax and treaties, tax deduction at source and appeal and judicial work, has also asked all field formations to send in their opinions on the draft Code. The committee is scheduled to submit its report by September 15, 2009 to the Board, which will then be submitted to finance minister Pranab Mukherjee. The restructured income tax slabs and rates, definitions and provisions on tax treaties are some of the areas that the CBDT wants to revisit. (FE)
• To ensure that a large batch of disinvestment proposals hit the primary market this fiscal, the government would depend on the follow on public offers from listed companies, instead of pushing for IPOs, as the shelf of such proposals is nearly empty now. This means 2009-10 may not see new public sector firms debuting in the stock market, after NHPC and Oil India.
• Govt is learnt to have set up an expert group to suggest ways to speed up liquidation of sick companies by resolving the procedural and legal complexities involved as winding up a sick entity involves multiple regulations and often faces long-drawn litigation. The group, which comprises members of the Institute of Chartered Accountants of India (ICAI), is expected to suggest streamlining of court procedures and reducing the time frame for winding up a sick company to 2-3 years. (ET)
• According to sources, Sistema Shyam Teleservices has filed a fresh application with FIPB seeking clearance for its internet subsidiary, after the DoT clarified that an earlier FIPB approval given to Russia’s Sistema for picking up 74% stake in the parent company did not cover the wholly owned unit. DoT said Shyam Internet Services, the internet service provider owned by Sistema Shyam, violated the country’s foreign investment norms as it did not obtain the mandatory FIPB approval despite Russia’s Sistema picking up a 74% stake in the parent company. The issue came to light when Shyam Internet Services, which currently offers services only in Rajasthan, sought DoT’s approval for launching a pan-India service and DoT refused to clear the proposal on the grounds that the company did not have the requisite FIPB clearance. The communications ministry may impose a penalty on the telco over its failure to obtain the requisite clearances for its internet unit. (ET)
• PSU teleco MTNL has submitted a bid to acquire a 75% stake in Nigerian Telecommunications (Nitel). MTNL will now appoint consultants to evaluate Nitel before placing a financial bid for the Nigerian government-owned telco that has both fixed-line and mobile operations (both GSM & CDMA). MTNL will, however, have to compete with 12 other bidders, including global majors such as Africa’s largest telecom operator MTN, the UAE’s Etisalat and Spain’s Telefonica. All bidders will be given access to Nitel’s books to begin due diligence. The deadline for submitting financial bids is October 2. The Nigerian govt’s 51% in Nitel was put up for sale in 2001. The value of Nitel, saddled with huge debts, then was said to be $1.2 b, but the sale fell through Nigeria relaunched the sale process this July. (ET)
• In a move to expand its footprint in the country, American Tower Corporation (ATC) is learnt to be in advanced talks for acquiring a couple of Indian tower companies. The Boston-based tower company is prepared to make significant investments in India but wants to buy at the right price. It is in discussion with a number of players in the Indian market and hopes to make one or even two acquisitions over the next few weeks and months if it gets the right valuations. The co. is looking at an outright purchase but are also flexible to take a majority stake. (BL)
