The parent companies of Indian mobile operators Uninor and Tata Docomo have appointed banks for advice on a possible merger or equity sale, according to the Business Standard.
Norway’s Telenor has reportedly mandated Citibank while Tata Group has…
The parent companies of Indian mobile operators Uninor and Tata Docomo have appointed banks for advice on a possible merger or equity sale, according to the Business Standard.
Norway’s Telenor has reportedly mandated Citibank while Tata Group has hired Lazard.
Telenor declined to comment on the speculation but added it will evaluate opportunities that become available and make business sense. Tata was not available for comment before the press deadline.
The report comes as the Indian government is considering allowing foreign investors to fully own telcos in an attempt to make the industry more attractive. At the moment, foreign direct investment (FDI) in telecoms companies is capped at 74%.
Rumours about a merger between Uninor and Tata Docomo, which would create India’s fourth-largest carrier, first emerged in late November last year.
It was also recently suggested that Tata Docomo could be combined with Aircel, in order to turn the latter around.
However, Tata Docomo’s owners – Tata Group and Japan’s NTT Docomo – are reportedly reluctant to take on Aircel’s debt.
Meanwhile, Telenor is the process of creating a new JV in India to replace Uninor. After months of a bitter dispute over management, Telenor finally reached an agreement late last year with Indian real estate company Unitech, its former partner in Uninor, whereby Unitech will sell its 26% stake in the JV.
Also last year, Uninor acquired 20-year licences for six of India’s 22 circles when frequencies were re-auctioned following the country’s telecoms scandal. Meanwhile, it shut down services in Kolkata, Mumbai, West Bengal, Karnataka, Kerala, Orissa and Tamil Nadu, where its 2G licences were cancelled.
