VSNL investment in Tata Tele wrong, says Mahajan

By : |May 30, 2002 0

NEW DELHI: Indian Telecommunications Minister Pramod Mahajan said that a
decision by the recently privatised telecoms firm Videsh Sanchar Nigam Ltd. (VSNL)
to invest in Tata Teleservices was wrong and must be reviewed.

"In my opinion, VSNL’s investment of Rs 12 billion in Tata Teleservices
is wrong. The government representative (on its board) had opposed it and we
hope that VSNL will reconsider it," Mahajan told reporters.

The Tatas own 45 per cent in VSNL after the recent privatisation while the
government remains a key stakeholder with a 26 per cent stake. Tata Teleservices
is a recently set up fixed-line service provider.

Mahajan said Tata Teleservices was too young a player and diversion of VSNL
funds to it would benefit the new firm rather than VSNL.

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