Loss-hit Telenor not to bid for spectrum, exit India operations
19 Jul 2016
Norwegian telecom operator Telenor has decided against participating in the upcoming spectrum auction in India, expected in September this year, asserting its decision to exit its telecom business in India.
Telenor had earlier announced plans to quit India unless it was able to secure additional capacity for its networks at a reasonable cost.
"Long term presence in India is dependent on our ability to secure additional spectrum. We are not able to compete with current spectrum portfolio we have in growing data market," Telenor global CEO Sigve Brekke had said while announcing financial results for first quarter ended 31 March 2016.
Telenor has "after thorough consideration, decided not to participate in the upcoming spectrum auction, as we believe the proposed spectrum prices do not give an acceptable level of return," Sigve Brekke, President and CEO, Telenor Group, said in a statement.
He said the decision was regardless of "the significant operational and financial improvement delivered by our Indian operation".
"We recognise the significant operational and financial improvement delivered by our Indian operation. We have, however, after thorough consideration, decided not to participate in the upcoming spectrum auction, as we believe the proposed spectrum prices do not give an acceptable level of return," the Norwegian telecom operator said in its financial report.
While announcing the March quarter results, the company had said that long terms presence in India is dependent on its ability to secure additional spectrum.
For the June quarter of 2016, the company has reported a higher operating loss of 132 million Norwegian Krone (about Rs105 crore at current exchange rate) compared to NOK90 million (Rs71.3 crore) registered a year ago.
"Operating profit was negatively impacted by NOK224 million (Rs178 crore) in impairments and write-downs, but offset by lower depreciations following the impairment and write-down of assets in the first quarter," it said.
The total revenue of the company, however, grew by about 12.73 per cent to Rs1,230 crore from Rs1,080 crore for the previous quarter.