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Last updated on April 18, 2014 at 1:21 EDT

Telenor Pays $1.23 Billion for 60% of India’s Unitech

October 31, 2008

Telecoms operator Telenor has agreed to acquire a 60% stake in India-based telecoms firm Unitech Wireless for INR 61.2 billion ($1.23 billion) to expand its footprint in the high-growth Indian telecoms market.

Norway-based Telenor will have four members on the board including the managing director, while Unitech will have three members including the chairman. Norway’s Ministry of Industry and Trade holds a 54% stake in Telenor and will fund the deal through a rights issue of NOK 12 billion ($1.7 billion).

Telenor has over 159 million subscribers across 12 markets and is the world’s seventh largest telecom operator.

Unitech Wireless was created in 2007 and employs 250 people. It holds telecoms licenses in all of India’s 22 telecommunication circles and has been allocated start-up spectrum in 13 circles. It expects to launch operations in the first half of 2009.

Sigve Brekke, executive vice-president and head at Telenor Asia operations, said: “India is one of the largest and fastest growing mobile markets in the world. While the telecom market here is crowded, we feel that there is room for a new entrant.”

India is the second largest mobile market in the world, after China, with 353.66 million subscribers at the end of September. The country added 9.79 million new users in the same month and has overall teledensity of 30%, according to market regulator TRAI.