Norway nod for Unitech deal in 6 mths: Telenor

Telecom giant Telenor hopes to get all regulatory clearances from Norway to complete its 60 per cent acquisition of Indian telecom company Unitech Wireless in the next 6 months.

Speaking on the sidelines of the World Mobile Congress here, Jon-Fredrik Baksaas, President and CEO of Telenor, said, "Our government's approval is there for investment. However, for over 49 per cent stake acquisition, a separate application has been put in. I hope to get the approval in 3-6 months."

The company has earmarked an initial investment of $2 billion for its first three years of operations in India. Clearing doubts on the investments to be made by Telenor in Unitech Wireless, Baksaas said, "Both parties (Unitech and Telenor) are committed to provide funds. Each penny of capital injection by Telenor is going into capital expenditure." The company is expected to roll out its operation in India later this year.

 

 

 

 

While the company is yet to get approval from the Foreign Investment Promotion Board, it is still bullish on the potential that the country provides. Baksaas said, "There is no reason why India with 30 per cent (telecom) penetration, will not be able to double it in next three-four years. While we talk about the China possibility, all our efforts are focused on India right now."

 

 

 

 

 

The company derived confidence from its operations in other countries in the sub-continent like Pakistan and Bangladesh, said Baksaas. He further said, "India is a long-term project and requires long-term investments over and above the initial investment, which we will make." 

Last week, Unitech Wireless signed infrastructure-sharing deals with Tata Teleservices' (TTSL) tower arm Wireless-TT Infoservices (WTTIL), and Quippo Telecom Infrastructure (QTIL). The company has also entered into a transmission deal with TTSL. These deals will help Unitech Wireless to close its transaction with Telenor which is expected to be sealed in the first quarter of 2009. 

Last year, Telenor had picked up 60 per cent stake in Unitech Wireless for Rs 6,120 crore. The Norwegian company is expected to pay the first tranche amounting to Rs 1,250 crore by the end of February. Commenting on the recent deals, Baksaas said, "The tower sharing deal with Tata Teleservices announced last week is significant to keep our infrastructure costs low. There are still more conditions of the agreement that need to be put in place. If these formalities cannot be resolved, then it is a matter of concern," he said.