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ByCell’s finances questioned

EAM questions the financial strength and credentials of the firm, which has applied for licences to operate telecom services in 5 circles – Assam, Orissa , Bihar, North East and WB, reports Arun Kumar.

india Updated: Feb 03, 2008 20:46 IST
Arun Kumar
Arun Kumar
Hindustan Times

The Ministry of External Affairs has questioned the financial strength and credentials of ByCell Telecommunications India Ltd, which has applied for licences to operate telecom services in five circles – Assam, Orissa , Bihar, North East and West Bengal – by raising doubts on its Swiss-based parent with Russian connections.

In an internal communiqué, the Indian Embassy in Berne, Switzerland, has stated that ByCell Holding AG is registered as a limited entity with a paid-up capital of 100,000 Swiss francs, which is the minimum required to register a company with limited liability.

ByCell Holding is the parent company for ByCell Telecommunications India in which it owns 74 per cent. The Indian Partner , Hyderabad-based Jayalakshmi Group, owns the remaining 26 per cent in the company through Bitcorp Pvt Ltd.

“It has not been possible to contact the company over telephone as they do not have a telephone at the registered office. Enquiries reveal that ‘Vorstadt32’ (the registered office) is a building with the offices of a number of companies, mostly operating as ‘post box’ entities,” states the official note.

ByCell applied for a licence in 2006.

When contacted, Andrey Poluektov, Director of ByCell Holding and also a director in the Indian venture, said the company had sufficient net worth to meet the capital requirements. The holding company has a net worth of $110.98 million. “Since the money is pending under share application and free reserves, we have not converted it into paid-up capital,” he added. The Indian partner has a net worth of Rs 55 crore..

ByCell Holding operating as the parent company and need not have a large infrastructure, Poluektov said. “We are operating across the world and currently focusing on India, which is one of the most vibrant markets. We are setting up operations and once we have the licences, we will scale up,” he added.

However, on the issue of the total amount of investment made across the world by ByCell Holding, Poluektov declined to comment.

ByCell Telecommunications India has a paid-up capital of around Rs 20 crore, which is funded in the ratio of 74:26 by the partners. Andre said that the company had submitted a bank guarantee as required by the Department of Telecommunications (DoT).

In ByCell Holding, 97 per cent of the stock is owned by Tenoch Holdings, Cyprus, which is jointly owned by Andre Poluektov and Maxim Naumchenko. Apart from this, three directors – Phillip Bare (Swiss resident,) Armand Guilmain (Swiss resident) and Maxim Naumchenko (Russian resident) hold 1 per cent each.