Posts Tagged ‘Telenor’

Telenor to drop Indian partner Unitech

Telenor wants to drop its Indian joint-venture partner Unitech after the Supreme Court revoked their mobile licences in the country and is seeking a new local partner, the Norwegian telecoms firm said on Wednesday.

Norwegian telecom company Telenor has served a divorce notice to Unitech, seeking compensation from the Indian firm for damages caused to their mobile venture, Uninor, from a recent Supreme Court judgement, and said it was looking for a new partner in India.

Europe’s third-biggest telecom company said it no longer believed that its strategic partnership with Unitech had a future and would start the process of looking for a new Indian partner. A source familiar with Telenor’s plans said it had tapped London-listed metals group Vedanta Resources’ Indian arm, Sterlite Industries Ltd, and Kolkata-based Srei Infrastructure, which runs mobile tower company Viom Networks, to be its new partner. These companies could not be reached for comment.

Uninor was one of the worst affected by the Supreme Court’s decision earlier this month to cancel 122 mobile licences issued under a scandal-tainted 2008 sale. The company, 67.25% owned by Telenor, held 22 of these licences.

Uninor India

Uninor Wireless plans corrective measures to improve India business

Telenor said its Indian operations will see a loss of `4,500-5,500 crore this fiscal and would face a further hit of `6,500-7,500 crore between 2011 and 2013 before breaking even. This is in line with its projections in 2008, when it had told investors it would take a ` 15,000-crore hit in India over five years ending 2013, before making cash profits

Many of the new entrants are battling for survival as the tariff wars in India’s ultra-competitive mobile market have significantly lowered the average revenue per user, making their businesses unviable. These companies, which include Videocon, Uninor, Sistema-Shaym, Loop, S Tel, Etisalat and Allianz Infratech, have all struggled with their rollout plans. Some of them have also approached the government seeking exit options.

While Uninor has been the best performer among the new entrants that launched services last year, it has failed to make a dent in the world’s fastest-growing telecom market as it commands only about 1% market share in India’s 650-million strong mobile base.