Nordic operator group Telenor will wait until the Indian government has clarified its rules regarding the telecoms sector before it considers any acquisitions or mergers in the country, reports the Wall Street Journal.
Yogesh Malik, chief executive of Telenor’s Indian unit, said in an interview that the company will use the intervening period to focus on lowering tariffs and adding subscribers in small towns in the six telecom circles in which it operates.
“We await clarity in the sense of rules, in the sense of regulations, in the sense of terms for mergers and acquisitions and spectrum fees,” he said.
Malik noted that the Indian unit has broken even in three of its six operating circles, with the remaining three on track to achieve the same by December. The six circles cover nearly 50 per cent of the country’s population, the executive added.
The comments come after India decided to allow full foreign ownership of its telecoms companies as it looks to boost the economy through increased foreign investment. Revised merger and acquisition rules for the sector are expected to be published by September.
Uninor, Telenor’s joint venture with local company Unitech, was transferred to a new entity controlled by the Nordic operator group at the end of 2012, when the partners went their separate ways. Telenor subsequently announced a deal in which Lakshdeep Investments & Finance would buy 26 per cent of the company, which was named Telewings.
The Nordic group secured spectrum in six of the country’s most populous zones in November 2012 with the company setting a top funding limit of INR155billion (US$2.85 billion) for its Indian unit shortly afterwards. It aimed to achieve operating breakeven by the end of 2013.
Malik declined to comment on whether Telenor would take full ownership of its local unit once the new regulations have been announced.