Who Can Be the Most Eligible Partner for Telenor’s Indian Operation?

By February 25th, 2012 AT 12:03 PM

Earlier we shared that joint venture of Telenor and Unitech is going to see an end, as Telenor is to form a new company with new Indian partner to offer mobile services in the country.

Current laws do not allow the Norwegian telecom giant to have a 100% owned Indian subsidiary and hence Telenor is in talks with several Indian companies to tie the knot for the upcoming 2G auction.

Telenor is to take 74% of the new venture and rest 26% will be for Indian partners. Telenor is open to have more than one Indian partner.

Telenor also made it clear that it will control all the assets – the entire network, the towers, customers and the entire business operations of Uninor and ensures the smooth transition of the assets to new JV.

According to ET News, the possible Indian companies could be Sterlite Industries which is a subsidiary of London based metal group Vedanta Resources and Kolkata based Srei Infrastructure who owns tower company Viom Networks (earlier Tata-Quippo).

Sterlite Industries is one of the companies who applied in 2007-2008 to enter Indian mobile market but fails to do so during A. Raja’s regime. They are in metal, mining, oil and gas and have no problem to fund the joint venture with Telenor. It should be noted that Telenor clears that their new partner do not need to have any experience on telecom. With a partner like Sterlite, Telenor will not need to think about money.

Srei Infra owns Viom Networks, a passive infrastructure provider which in turn has more than 40,000 telecom towers in India, which means Telenor will have a rapid network expansion mode with Srei Infra. Most new players are on leasing towers to speed up their coverage expansion; with a tower company in the venture Telenor will be happy to be with Srei Infra.

Now apart from these two companies any company which fails to obtain license and spectrum in 2008 may like to join hands with Telenor. In 2007 there were 21 companies applied to DoT to get 2G spectrum. It could be steel tycoon Jindal’s JSW Power Trading Company,  Hinduja promoted HTMT Telecom Private Ltd, Spice/Modi promoted CellebrumMoser Baer Infrastructure Ltd, Vasai Group’s Next Generation Telecommunications India Pvt. Ltd (who planned to bring TD-SCDMA based mobile services in India) and others who are in the queue.

Following the decision of end of JV, Telenor sends a notice of ‘divorce’ to Unitech and seeks compensation for damages caused by the recent SC judgement as Unitech Wireless grabbed pan India license in 2008 and later Telenor bought shares in it and invested around 14000 cr. Unitech reacts that on the basis of ‘non compete clause’ on share holding agreement Telenor can not start their own JV until the current JV is broken down.

The relation between these two companies takes a downfall after Unitech head was arrested in the 2G scam.

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