Telenor asks for government help / News / The Foreigner

Telenor asks for government help. Norwegian telecoms giant Telenor has requested government intervention to get its mobile license back in India on the back of reports the company knew of pre-market penetration corruption risks. The move follows yesterday’s decision by India’s Supreme Court to rescind 122 operator permits for Telenor, partner Uninor, and other companies. 3 to 4 percent was wiped off Telenor’s share value, and CEO Jon Fredrik Baksaas believes his company could lose approximately 12 billion kroner. Share prices fell a further 2 percent this morning.

telenorunitechmobilelicenses, indiasupremecourtruling



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Telenor asks for government help

Published on Friday, 3rd February, 2012 at 13:02 under the news category, by Michael Sandelson and Lyndsey Smith      .
Last Updated on 3rd February 2012 at 13:13.

Norwegian telecoms giant Telenor has requested government intervention to get its mobile license back in India on the back of reports the company knew of pre-market penetration corruption risks.

Telenor / Uninor
'Telenor's investment in India has been a nightmare from almost day one,' says analystTelenor / Uninor
Photo: Espen Klem/Flickr


The move follows yesterday’s decision by India’s Supreme Court to rescind 122 operator permits for Telenor, partner Uninor, and other companies.

3 to 4 percent was wiped off Telenor’s share value, and CEO Jon Fredrik Baksaas believes his company could lose approximately 12 billion kroner. Share prices fell a further 2 percent this morning.

In response to Telenor’s request, Norway’s Trade and Industry Minister Trond Giske says, “We are following the situation and are in contact with them about the matter.”

“We’re currently obtaining information about the ruling and as what alternative courses of action are available. Norwegian authorities will actively contribute to find solutions to secure Telenor’s major investments and presence in India,” reports NTB.

According to Reuters, Uninor senior personnel are “shocked” and feel “unfairly treated.” The alleged improper license awards mean the loss of around 36 million subscribers in India.

Mr Baksaas told NRK, Thursday, “It’s quite special to wake up to such news. Making such a decision against an entire industry is quite devastating to the industry's development status.”

Uninor, previously known as Unitech Ltd, became implicated in the scandal 2010 following 2G license awards two years earlier. These 85 were sold at 2001 rates without bidding.

The impropriety could have cost India between 900 billion and 1.4 Trillion Rupees. Former Minister of Telecommunications Andimuthu Raja is also allegedly involved, along with 14 others.

In April 2011, Prime Minister Jens Stoltenberg tried to protect Telenor by writing a letter to Indian counterpart Manmohan Singh. The Norwegian state owns a 54 percent stake in Telenor.

PM Stoltenberg said at the time, “We are concerned that Telenor should not be penalized for things they are not responsible for.”

It was cleared of any corruption accusations by the Indian government, as the illegalities took place prior to Telenor buying Unitech shares in 2008.

Meanwhile, Telenor chairman of the Board, Harald Norvik, will not admit he received written warnings from US and UK shareholders about suspicions Unitech obtained the licenses at below-market prices. At the same time, anonymous source tells Finansavisen Telenor had been clearly informed.

Mr Norvik states, “We knew about the corruption allegations and made extensive inquiries about this. However, we didn’t consider it was actually risky,” he says.

“This case is not about corruption, but whether [Indian] authorities were able to distribute licenses on a ‘first come, first served’ basis,” Sigve Brekke, head of Telenor’s Asian operations, tells NA24 by phone from Delhi.

Telecom analyst John Strand calls Telenor’s investment in India, “a nightmare from almost day one”, saying to NRK, “the Supreme Court’s ruling is one of the biggest disasters to hit Telenor to date.”




Published on Friday, 3rd February, 2012 at 13:02 under the news category, by Michael Sandelson and Lyndsey Smith      .
Last updated on 3rd February 2012 at 13:13.

This post has the following tags: telenorunitechmobilelicenses, indiasupremecourtruling.





  
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