Uninor to scale down operations in 4 circles

Remaining circles will be focus area for spectrum bidding

Uninor, the joint venture between Norwegian telecom giant Telenor ASA and India’s Unitech Ltd, on Tuesday announced it would scale down operations in four of its 13 commercially active telecom circles in order to secure operational funding.

The company, which lost its licences after a Supreme Court order, said it would set up more aggressive targets for customer acquisition in the nine remaining circles, which would be its new focus area for bidding in the coming second generation (2G) spectrum auction.

The four circles Uninor has identified for scaling down are Tamil Nadu, Karnataka, Kerala and Odisha. With 6.4 million customers, these circles constituted around 15 per cent of the company’s total subscriber base of 45.58 million in June.

SWITCHING FOCUS IN INDIA

• Circles where operations are being scaled down:
  Tamil Nadu, Karnataka, Kerala, Odisha
   
• Circles where the company will continue to focus:
  Up East, up West, Bihar & Jharkhand, Kolkata, West Bengal, Andhra Pradesh, Mumbai, Maharashtra & Goa and Gujarat

The other nine circles include Uttar Pradesh East and West, Bihar, Jharkhand, Kolkata, Gujarat, Mumbai, Goa and Andhra Pradesh.

Telenor recently sought government permission to raise a part of the $2 billion required to run its current operations and bid for spectrum through external commercial borrowings.

The company said its peak funding requirement of Rs 15,500 crore would be maintained, but the funds would be channelised to the nine circles. “We are now forced to take this difficult but necessary decision. Our plan now is to enter the auctions with a very strong presence in these nine circles,” said Uninor MD Sigve Brekke.

Supporting the move, Jon Fredrik Baksaas, president and CEO of Telenor Group, said: “Since February 2, the Telenor Group has continued to single-handedly provide financial backing to Uninor on belief of an early resolution. However, with no sight of either auction rules or dates six months later, we support Uninor in taking this financially prudent decision.”