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VSNL chief's tenure uncertain

Hemangi Balse & Freny Patel

S K Gupta, Tatas' nominee managing director at Videsh Sanchar Nigam Ltd, faces an uncertain future at the helm.

Gupta, who resigned from the board on February 13 when the company was still under government control, had, however, accepted the Tatas offer to be continue as managing director.

It now remains to be seen whether Gupta's term expires in four months when he turns 60. Because in public undertakings, the retirement age stands at 60 for all officials and the Tatas, where the management cadre retires at 65, has not changed VSNL's human resources policy.

When asked about Gupta's term coming to an end in September, a spokesperson for the Tatas said, "It is up to the board of VSNL to decide on this."

Incidentally, considering the VSNL's current board composition of four Tata nominees and two government nominees and a probable new board comprising eight Tata nominees and four government nominees (following the change in the shareholding pattern), it is clear that the Tatas will decide on Gupta's tenure.

When the Tatas took over the management of VSNL from the government they preferred to continue with the existing management and offered Gupta to run the show.

Though the Tatas have yet to decide on the successor it is expected that N Srinath, who was chief executive officer of Tata Internet and joined VSNL as an executive director, will succeed Gupta.

Last week, the Tatas completed their open offer for acquiring 20 stake from the public after acquiring 25 per cent government's stake in February for Rs 14.39 billion.

Tatas appointed four directors and decided to continue with the existing management team headed by Gupta. Except for R S P Sinha, director-finance, all other executives decided to continue under the new management.

VSNL's monopoly in international subscriber dialling has come to an end and as a result of increased competition, private Internet service providers took a larger share of the Internet-access market.

Last month, the Tatas had set up a committee to relook at all the businesses of VSNL and to see how best they could be aligned with its other group telecom companies to maximise returns and avoid competition within group firms.

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