Telenor settles USD1.77bn loans to ‘keep Uninor in business’

21 Aug 2012

Norwegian telecoms group Telenor has directly settled INR98 billion (USD1.77 billion) bank debts at its 67%-owned Indian mobile subsidiary Unitech Wireless (Uninor), an action it claims was necessary for the cellco to continue its operations, Dow Jones Newswires reports. Uninor had failed to extend some of its loans from Indian and international banks, which were fully guaranteed by Telenor, and a statement claimed that Uninor’s operations had been relying on short-term loans because one of its shareholders [referring to the only other stakeholder, Indian real estate developer Unitech] had ‘refused to fund the company through its own funds and has also actively worked to stop the majority shareholder [Telenor] from doing so.’

In February 2012, following the Indian Supreme Court’s mass cancellation of Indian 2G licences including Uninor’s, Telenor announced that it saw ‘no future’ in its partnership with Unitech, and would be looking for another partner in the country. Earlier this month, CommsUpdate reported that Telenor was close to clinching a deal with a new partner, aiming to take a 74% stake in a fresh mobile venture, with the managing director of Uninor and head of Telenor’s Asia operations, Sigve Brekke, saying that the Norwegian firm was already ‘taking steps to moving our assets to the new company.’ Brekke added that he expected the asset transfer, currently being blocked by Unitech, to be completed before the upcoming re-auction of 2G licences, although clarifying that the telco must first finalise the separation process with Unitech. The court orders to cease services under existing licences take effect on 7 September 2012.

India, Telenor Group, Telenor India