The proposal was amongst 25 foreign investment proposals worth Rs 394.84 crore (Rs 3.94 billion) cleared by Finance Minister P Chidambaram.
According to VISA group's chairman Vishambhar Saran, Encotra AG of Switzerland held a 21 per cent stake in the company. This stake was recently acquired by VISA Minimetal AG, a VISA group company based in Switzerland.
Overseas companies of the group will now raise their stake in VISA International to 74 per cent, Saran said.
"The shares of Encotra were brought at the rate of Rs 50 per share. If the shareholding of our overseas companies is raised to 74 per cent at the same price, it will result in an inflow of Rs 174 crore," he added.
The group had bought out Encotra, Saran said, because the Swiss company wanted to raise its stake to 26 per cent, which would have given it the power to block all special resolutions.
"It was then that we decided to part ways amicably. VISA International is like a family jewel for us," he added.
VISA International is a loosely held company that owns the various real estate assets of the group, as well as a 32 per cent stake in VISA Industries, which is putting up a greenfield steel plant in Orissa.
The government has also cleared the proposal of the US- based Wyse Technology Inc to set up a 100 per cent owned entity in India, by investing Rs 66 crore (Rs 660 million) to undertake importing, marketing and distributing Wyse Technology's products in India
Besides, the government has also approved the proposal of Metcoke Singapore Pte to invest Rs 70 crore (Rs 700 million) in setting up a venture to undertake manufacturing of metallurgical coke based on non-recovery technology in Tuticorin, Tamil Nadu.
In the area of broadcasting sector, Asianet Satellite Communications has been permitted to issue redeemable non-cumulative preference shares worth Rs 30 crore to Satish Raheja.
The south Indian television broadcaster has recently restructured its equity structure by off-loading up to 9.33 per cent equity in the company to the Mauritius-based Americorp Ventures.
As a part of the deal, the Indian broadcaster transferred 700, 000 equity shares of Rs 10 each to the foreign investor from its Indian shareholder Anjali Technology Holdings.
However, the government permission has come with certain riders, with the government asking the broadcaster to come within the purview of the news and current affairs TV channels in India.
The government has also stipulated that the in the case of foreign investment in the company, it should be limited to 26 per cent foreign direct investment. Besides, the government has pointed out that the company should not bring in any other kind of foreign investment into it.