Ahead of the 2G auctions, Norwegian telecom operator Telenor has raised its stake in Telewings, which provides telecom services in India under the Uninor brand, to 74%, reports PTI. When Telenor had initially signed up with Lakshdeep Investments & Finance Pvt. Ltd, a company controlled by Sun Pharma’s Sudhir Valia to set up Telewings Communications, the plan was to eventually increase its holding to 74%. In June 2013, Telenor had received an approval from India’s Foreign Investment Promotion Board (FIPB) to increase its stake to 74% from the existing 49%, and invest up to Rs 1,000 crore in the JV.
In September, Uninor announced that it has achieved EBITDA break even in circles – UP (West) and Bihar, apart from UP, Gujarat and Andhra Pradesh, where it had broken even earlier. Its target was to break even in all six circles by the end of 2013.
With time, one can expect Telenor to increase its stake to 100%, given that India has now allowed 100% FDI in telecom. Telenor was previously in partnership with Unitech, a JV which it had entered into after the infamous allocation of telecom of licenses in 2008. That partnership ended on a bitter note after the Supreme Court of India terminated 122 licenses. A timeline of that dispute here.
Telenor subsequently set up Telewings, which was among the few entities to participate in the 2G auctions in November 2012, where it won spectrum in Maharashtra, Gujarat, UP (East), UP (West), Bihar and Andhra Pradesh. It paid Rs 4,018.28 crore in the November 2012 2G spectrum auction. This was the highest price per MHz a telco had paid in the auctions. The company had closed down operations in seven of thirteen operational telecom circles in 2012 and in Q1 2013, including the sudden shutdown of operations in the Mumbai circle, following a Supreme Court order which had directed all unsuccessful bidders in the November auctions to close down services immediately.