Voda covets 49% in Singh, Ghosh firms

British telecom major Vodafone, which bought 67% in Hutch-Essar more than two years ago, is all set to inject funds into the companies of its minority shareholders — Asim Ghosh and Analjit Singh.

Sources said by investing in these companies, Vodafone would find it easier to foray into 3G (third generation) telecom services, among other things. Vodafone’s proposed funding will be in keeping with the new foreign direct investment of FDI norms.

According to the norms, FDI routed through an Indian company owned and controlled by resident Indians will not be taken into account while calculating sectoral limits. An Indian-owned company is one in which resident Indians or Indian companies have more than a 50% beneficial stake. The new guidelines stated that Indian promoters can bring in foreign investments up to 49% as long as they hold more than 51% in an operating-cum-investment company.

Also, if a holding company is 51% owned by an Indian promoter, the rest of the equity could be raised through different sources, including FDI. If a holding company with foreign investment of less than 50% invested in its subsidiary, then the investment made would be treated as a 26% FDI in the subsidiary.