A decade following the sale of Videsh Sanchar Nigam Limited (VSNL) to Tata Communications, the government has finally reached an agreement with the Group to sell the surplus land owned by the company, say news reports.
The government plans to raise Rs 61.5 billion by selling the surplus land owned by VSNL. In 2002 Tata Group had picked up a majority stake in VSNL. However, at the time the 773 acre land owned by VSNL across places such as Delhi, Kolkata, Chennai and Pune, was not part of the stake sale deal.
Following the majority stake sale to Tata Group, the Department of Telecommunications (DoT) proposed to hive off the surplus land held by VSNL into a separate company to unlock the value by selling the land. The proposal was opposed by the Tata Group and it sought clarity regarding issues such as the party bearing the cost of creating a new company.
Meanwhile, Tata Group formed a company, Hemisphere Properties India Limited to hold the surplus land. DoT plans to take up 51 per cent ownership in the company, with the pre-divestment shareholders of VSNL getting the remaining 49 per cent. In turn, Tata Group will get about 5 per cent of the proceeds of the sale corresponding to the 5 per cent additional stake acquired by it in VSNL in the past few years.
Hemisphere Properties India Limited plans to appoint a consultant having expertise in handling company law, land revenue and tax matters to proceed further with the sale of the surplus land.
