Telenor plans Rs20bn investment in India

Norway’s Telenor Group, which is looking for a new partner to continue its telecom services in India, plans to invest up to Rs20bn ($385mn) more even as it is taking steps to secure Rs145bn already pumped into Uninor, the joint venture with Indian realty firm Unitech.Uninor managing director Sigve Brekke told reporters here yesterday that Telenor was committed to continuing the services with a new partner, replacing the Delhi-based Unitech.Brekke said he was hopeful of finding an early solution to the situation arising out of the cancellation of the company’s 2G telecom licences by the Supreme Court, and added while continuing the arbitration in Singapore for separation with Unitech, they were in talks with four to five companies in India.Declining to name the companies, Brekke said they were looking for a partner, who is not a telecom operator and who is keen to have a long-term commitment.The new partner will have 26% stake in the company as Telenor has decided to increase its equity from 67% to 74%.Stating that Telenor has already made substantial investment into Uninor, Brekke said they need to secure the investment. “We need to do whatever we can to secure this huge investment,” he said, when asked about a notice served by Telenor to India in March under the bilateral treaty.India has six months to sort out the issue under the bilateral treaty. Brekke noted that they already had positive dialogue with the Indian government, and the prime ministers of India and Norway also discussed the issue.Telenor has plans to invest another Rs10bn to Rs20bn. “The subsequent investment will be from the cash reserves of the company,” said Brekke who is hopeful of the company turning profitable in the first half of 2013 as originally envisaged.With a 40mn customer base, Uninor is the sixth largest telecom player in India.Asked about the future plans, he said the firm would focus on voice and ruled out participating in 4G and even 3G auction for now.He said it may take two to three years before the company moves to data. “We need to be focused. We are looking at 6.5 crore (65mn) customers. Then we will have a scale. It will be step-by-step approach.”The Supreme Court in February cancelled all 22 licences held by Uninor. While cancelling all licences issued during the regime of then communications minister A Raja, the court asked the government to conduct a fresh spectrum auction by June 2.Uninor is hopeful that a fresh spectrum auction will take place before its licences expire on June 2.“We still have not discussed this,” Brekke said when asked if Telenor will re-brand the company.On the valuation of the company, he said it would not be what it was two years ago.“We have already done it (valuation) and we are also frequently updating it as the situation is changing,” he said. The settlement, however, will be on the basis of independent valuation. To another question, he said the valuation has come down.He clarified that Telenor did not buy any stakes from Unitech, which invested Rs61bn to buy licences and to build business. “Unitech did not get money into the company. All our investments went into the company and it was used to roll out services,” he said.