Norway’s Telenor Group has entered into an agreement to sell 100% of its mobile operations in Myanmar to Lebanese investment firm M1 Group for a total consideration of USD105 million, of which USD55 million is a deferred payment over five years. The transaction corresponds to an implied enterprise value of approximately USD600 million, according to Telenor, which confirmed that M1 will acquire all shares in Telenor Myanmar and continue the current operation.
Previously, Telenor Group announced an impairment of Telenor Myanmar (May 2021), and while it stressed that its operation in the country continued, it did suggest that its future presence would depend on the developments in the country. Now, in announcing the sale of the unit, the Norwegian telecoms giant said that ‘further deterioration’ of the situation in Myanmar had formed the basis for its decision to divest Telenor Myanmar.
With effect from second quarter of 2021, Telenor Myanmar will be treated by Telenor Group as an asset held for sale and discontinued operations; the gain/loss calculation arising from the transaction will be impacted, inter alia, by the accumulated translation differences related to the Myanmar operation and will be finally determined at closing. Meanwhile, the transaction is subject to regulatory approvals in Myanmar.
Commenting, Sigve Brekke, President and CEO of Telenor Group, said: ‘The situation in Myanmar has over the past months become increasingly challenging for Telenor for people security, regulatory and compliance reasons. We have evaluated all options and believe a sale of the company is the best possible solution in this situation. The agreement to sell to M1 Group will ensure continued operations.’