Telenor completes Unitech Wireless buy

Written by Corporate Bureau | New Delhi | Updated: May 21 2009, 06:28am hrs
Norwegian telecom operator, Telenor ASA on Wednesday completed the acquisition of 49% stake in Unitech Wireless Ltd, the telecom arm of the realty firm, Unitech Ltd, by infusing additional investment of Rs 1,130 crore for an additional 15.5%. Telenor had earlier invested Rs 1,250 crore in the telco for a 33.5%.

Last year, the Nordic operator had acquired up to 60% stake in Unitech Wireless for Rs 6,120 crore, which earlier this year they increased to 67.25% for the same amount. Now for completing the transaction beyond 49%, Telenor will have to seek the approval of the foreign investment promotion board (FIPB) as automatic foreign investment in the telecom sector is allowed only up to 49%.

Telenor was earlier expected to raise the Krone 12 billion from the rights issue. However, the company had to scrap the rights issue due to the global economic crisis. The money for the Unitech deal was then funded through a mix of debt and cash flows. Unitech Wireless is one of the five new mobile operators who are to start operations some time this year. Unitech Wireless has pan-India telecom licences in 22 circles. Telenor is a global provider of telecommunications, data and media communication services

Thje company has already awarded its IT contract to Wipro and mobile network contract to Huawei and Alcatel Lucent.