Sistema reports $530 million net loss on licence cancellation
27 Apr 2012
Russian conglomerate Sistema today posted a net loss of $530 million writing off $346 million due to cancellation of 21 licences of its Indian telecom joint venture.
The company also wrote off $352 million of goodwill of the joint venture firm, Sistema Shyam Teleservices (SSTL).
"The Group's consolidated results for the fourth quarter of 2011 and the full year were impacted mainly by non-cash one-off ... Related to the $346 million loss from impairment of SSTL licences following India's Supreme Court ruling to cancel 122 licences," Sistema Joint Stock Financial Corp said in a statement.
In February, the Supreme Court cancelled 122 2G telecom licences, including 21 of SSTL, awarded in 2008 by controversial telecom minister A Raja.
Sistema owns a 56.68-per cent stake, while the Russian government represented by Rosimushchestvo (Federal Agency for State Property Management) a 17.14 per cent stake and Indian firm Shyam Telelink holds a 26.05 per cent stake in SSTL.
The group posted net loss of $530.2 million in the three months ended 31 December, as against a net profit of $221.5 million in the year ago period.