NEW DELHI, NOV 17: Public sector MTNL (Mahanagar Telephone Nigam Ltd) is likely to go shopping, buying stake into other telecom ventures in basic services and cellular services as well as acquiring small companies in the field of manufacturing optical fibre and telephone instruments. MTNL is already talking to Essar to pick up around 15% in its basic service project in Punjab. Already, there have been three rounds of meetings between MTNL chairman S Rajagopalan and Essar chief Shashi Ruia to discuss the issue.MTNL has laid some conditions before the deal can be sealed - first that Essar should have a less than 50 per cent stake in the Punjab project so that management control will be open for other equity partners. MTNL has also said that for it to show interest in the project, it would want to exercise some control on the network planning and roll-out so that its has a leash on the expenditure side in the project.The shopping spree embarked upon by MTNL is a result of the clearance of the new articlesof association for the company the nod for which has been given by the government a few days ago. The process which initially began when the company was awarded the Navratna status in October, 1997, has now been completed. When contacted, MTNL chairman Rajagopalan confirmed that the clearance for the new avtaar of the PSU had finally been okayed by the government. ``We have called for an Extraordinary General Body Meeting (EGM) of our expanded Board to clear the amended articles of association which will give us a great degree of freedom to operate our businesses,''Rajagopalan said.The new independence will allow MTNL to incur capital expenditure without any limit, form Joint Ventures with other companies where MTNL's equity stake can be upto Rs 200 crore, allow strategic partnership with multinational companies in telecom, set up new offices in India and abroad, formulate its own Voluntary Retirement Scheme (VRS) and buyback of its own shares.``While the government has given me this clearance, my firststep will be to register a new company - Millennium Telecom which will handle all Value Added Services of the company like internet, intelligent network services, smart cards and even cellular services if the government agrees to award the cellular licence in the name of the new company,'' says Rajagopalan. Millennium Telecom will also float Requests for Proposals (RFP) for a foreign joint venture partner for its Millennium Telecom company.``We are also looking for acquiring small companies manufacturing cables and telephone instruments as this will help in vertical integration of our company,'' says Rajagopalan. ``However, I would have to be weary as I do not want to acquire a white elephant like a large sick PSU but rather small functioning and profit making units which will help the parent company's businesses,'' he adds.Rajagopalan, while confirming talks were on with Essar for the Punjab basic circle refused to divulge any details of the talks.
