Norway headquartered telco Telenor has received an approval from the Foreign Investment Promotion Board (FIPB) to increase its stake to 74% from the existing 49% in its Indian joint venture Telewings, reports PTI (via The Economic Times), citing the Economic Affairs Secretary Arvind Mayaram who heads FIPB.
Its currently not clear as to how much foreign investment has been allowed for this transaction, since Mayaram didn’t disclose any specific number and there is no information regarding this on the FIPB website at the time of writing this article.
The company had then said that Telenor will eventually own 74% of the joint venture, following all requisite government approvals. It will also maintain the operational control of the venture and all assets of Unitech Wireless will be transferred to this company for seamless continuity of operations, following requisite approvals.
In April 2013, FIPB had deferred Telenor’s proposal to increase its stake to 74% form existing 49% in the joint venture. However, earlier this month, the Commerce, Industry & Textiles minister Anand Sharma had told Telenor Group CEO Jon Fredrik Baksaas that it will speed up the approval process of its investment after Baksaas had raised this issue during their meeting.
Interestingly, this approval comes at a time with the Indian Government is reportedly considering removing the FDI cap on the telecom sector by late June or early July 2013, thereby allowing foreign investors to own 100% stake in telecom companies, up from the existing 74% limit.