Telenor Group finalised the sale of its Pakistan mobile unit to Pakistan Telecommunications Company (PTCL), a move which will create the largest operator in the country with an estimated 70.6 million mobile connections once closed.

The Norway-headquartered operator stated the transaction wraps up a strategic review of its operations in the country unveiled 18 months ago, with rumours surfacing in July PTCL was interested in acquiring Telecom Pakistan.

Telenor said the transaction values its unit at NOK5.3 billion ($493.5 million) on a cash and debt-free basis. 

In a stock market filing, PTCL said it will fund the acquisition through external debt it plans to raise.

GSMA Intelligence estimates Telecom Pakistan ended September with 45.4 million mobile connections and PTCL 25.2 million.

Veon-owned Jazz had 70.5 million and China Mobile-backed Zong 46.8 million.

Telenor CEO Sigve Brekke suggested the consolidation would help strengthen Pakistan’s telecoms sector, creating opportunities in new areas of growth.

Petter-Borre Furberg, head of Telenor Asia, added it believes the market will be better served by a strong local champion.

“Our strategy in Asia is to build number one positions in the markets we operate, with scale as a pre-requisite for value creation and profitable growth,” Furberg said.

Telenor booked a NOK2.5 billion impairment charge on the unit in July 2022, pointing to a deteriorating macroeconomic situation.

PTCL is owned by UAE-based e&.

The sale marks the continued retrenchment of Telenor’s operations in Asia, following a merger of Digi in Malaysia and dtac Thailand, and the sale of its Myanmar unit in 2021 to Lebanon-based M1 Group for $105 million.