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Sources say Norwegian operator looking to raise as much as US$1.8 billion for Indian business.
Telenor is considering exiting the Indian telecoms market due to its lack of scale, particularly in the 3G and 4G sectors, it emerged this week.
The Norwegian operator is looking for a deal that values its Indian business at US$1.6 billion-$1.8 billion (€1.4 billion-€1.6 billion), the Economic Times reported on Monday, citing two sources close to the situation.
However, the paper suggested that it might be able to raise $1 billion at best, its spectrum being its most saleable asset.
While Telenor holds some potentially valuable airwaves, its overall lack of spectrum might trigger a decision to leave the market, one of the sources said, noting that the telco has thus far failed to failed to broker any spectrum trading deals and has lost out to larger rivals when spectrum has been available for sale.
Indeed, the operator – then known locally as Uninor – walked away from last year’s auction of frequencies in the 800-MHz, 900-MHz, 1800-MHz and 2.1-GHz bands with nothing. Meanwhile, big spender Idea Cellular spent more than 300 billion rupees (€4.4 billion) to secure airwaves in three of the four bands and mobile market leader Bharti Airtel racked up a bill of INR291 billion.
Telenor claimed a mobile market share of just 5.05% at the end of January, according to the Telecom Regulatory Authority of India (TRAI). It offers services in six circles, its customer base totalling 51.4 million.
By contrast, Bharti Airtel had 245.8 million mobile subscribers at the same date, giving it a market share of just over 24.15%. Bharti has operations in all 22 circles and late last week secured additional spectrum from rival Aircel to enable it to offer LTE services in all circles. It will pay 35 billion rupees (€462 million) for 20 MHz of 2.3-GHz frequencies in eight telecoms circles.
Bharti, like its competitors, is preparing for the launch of Reliance Jio Infocomm, which is rolling out pan-Indian 4G services.
Telenor’s presence in the mobile data market is restricted by its lack of spectrum, but it is rolling out LTE using a very narrow frequency range – 1.4 MHz of its 1800-MHz spectrum allocation – in Varanasi, Uttar Pradesh. According to local press reports, it aims to replicate that model across its circles later this year.
It will be difficult for Telenor to compete against deep-pocketed rivals in future auctions, the Economic Times quoted one of its sources as saying. "They have run out of options in India," s/he said.
There has been no official comment from Telenor.
