Telenor Gets Approval to Increase Indian Investment

­India's Cabinet Committee of Economic Affairs (CCEA) has announced that greenfield operator, Unitech Wireless' application to increase its foreign shareholding up to 74% has been approved. The application was earlier approved by the Foreign Investment Promotion Board (FIPB) in August 2009.

"Telenor Group has been optimistic of a favourable outcome that allows us to increase our holding in Unitech Wireless. We welcome the announcement from the CCEA, and will await the formal communication before we finalize the process of increasing our stake to 67.25%", said Sigve Brekke, Executive Vice President of the Telenor Group and Head of Telenor Asia.

Unitech Wireless is owned by the Telenor Group and Unitech Ltd. At present, the Telenor Group has invested NOK 3.2 billion (US$570 million) through subscription for new shares to hold a 49% stake in the company. The formal approval will allow the Telenor Group to increase its investments to hold 67.25%, as agreed between the two shareholders.

The approval for the increase was rumoured a few months ago, but only on the condition that no employees from Telenor's Pakistan subsidiary work for the Indian company. Telenor is also a majority shareholder in Bangladesh's Grameenphone, but this was not considered to be such a significant security risk.

Posted to the site on 19th October 2009