Norwegian telco Telenor has asked the Indian finance ministry to relax external commercial borrowing (ECB) guidelines on a one-off basis so it can put US$2bn into its JV subsidiary Uninor, according to local newspaper Business Standard.
Telenor has made…
Norwegian telco Telenor has asked the Indian finance ministry to relax external commercial borrowing (ECB) guidelines on a one-off basis so it can put US$2bn into its JV subsidiary Uninor, according to local newspaper Business Standard.
Telenor has made the request to allow it to extend a loan in excess of US$750m so the JV can buy 2G spectrum in the upcoming auction, and for its operational costs in India. Uninor’s 2G licences were revoked by India’s Supreme Court in early February in the wake of the 2G scam.
Telenor has also reportedly asked for a temporary repeal of the end-use restrictions prescribed under the ECB guidelines on repayment of rupee loans, operational expenditure, working capital requirements and general corporate purposes.
India’s central bank will reportedly be consulted before decisions on Telenor’s requests are made.
Last week, it was reported that Telenor had mandated Citigroup to find it a new partner in India ahead of taking part in the 2G auction. The move follows difficulties Telenor has run into with Unitech, its current JV partner in Uninor of which the Norwegian telco owns a 67.25% stake.
The relationship between the joint venture partners is tense, and a legal dispute over the management of Uninor, which culminated when the JV had its 2G licences revoked, is ongoing.
