Telenor, Uninor’s Norway head plans to buy the mobile services business of Videocon group, the discussion of which has reached its final stage. Venugopal Dhoot-owned Videocon telecom has a liability of more than Rs. 500 crore with the Government. This factor remains a hurdle for the companies to close the deal.
Telenor cannot accept the existing liability of Videocon telecom as it already bears a liability to Indian Government via its Indian arm Uninor. The 500 crore is its airwave charges that the company used between 2nd February 2012 and 15th February 2013. Inclusive of this debt, the entire debt portfolio of Videocon will come around Rs. 10,000 crore.
The deal is viable to both, as Videocon already wants another strategy of expansion for its telecom and Telenor’s Uninor anticipates an expansion in Indian market. “Since both are relatively small and both have liberalised spectrum, they won’t have a problem with existing M&A rules. They don’t need to bother about the spectrum caps as well,” sources reveal.
Videocon telecom Chief Arvind Bali has confirmed that the company is in talks with international companies for stake sale. But, he refused to share more comments.
Source : Moneycontrol.com