Norway's Telenor ASA (TEL.OL) plans to fight an order by the Supreme Court to cancel 122 telecoms licences held by its Indian joint venture, but has not ruled out abandoning the country altogether, the head of the company's Asian operations said.
Telenor has been unfairly harmed by the order, Sigve Brekke told a news conference on Monday. Legal options for the company include seeking a review of the court ruling, he said.
The Supreme Court on Thursday ordered that all 122 licences issued under a scandal-tainted 2008 sale be revoked within four months and asked the industry regulator to propose rules for an auction of licences and spectrum.
Telenor began business in India later that year when it bought a majority stake in a nascent mobile phone operator founded by Indian real estate company Unitech Ltd (UNTE.NS).
We have been asked to lose all (our investments) just because India in hindsight has changed its mind. Is that fair?, Brekke said.
I am angry and upset, because it's very clear that we are unfairly harmed, Brekke said, adding Telenor is exploring diplomatic as well as legal options to resolve the issue.
Norway's minister for information technology, Rigmor Aasrud, separately told reporters in New Delhi she would speak to Indian authorities about fair treatment, transparency and stable long-term possibilities for Norwegian companies.
Telenor's joint venture with Unitech, which operates under the Uninor brand, has been among the most aggressive of India's newer telecoms companies. It has close to 40 million customers, or more than 4 percent of the market.
Telenor has said it will write down 4.2 billion crowns related to its Indian operations.
Several Telenor investors have said the company should abandon India in the wake of the ruling, citing what they believe are weak prospects for the business.
India is the world's second-largest cellular market by subscribers, with 894 million at the end of December, although fierce competition means call rates are among the lowest.
Of course exit is also an option, Brekke said. Because if this does not work out, if there is no way we can make sense out of this, of course we need to look at exit as an option.
Telenor Chief Executive Jon Fredrik Baksaas told Reuters last week Telenor had spent about two-thirds of the total planned investment of $3 billion in Asia's third-largest economy.
Telenor shares were down 0.9 percent on Monday morning compared with a 0.1 percent drop in the European telecom sector .SXKP.
The companies whose licences were cancelled have the right to bid in a auction to regain the licences and radio airwaves.
The Supreme Court ordered the telecoms regulator to come up with rules to auction the spectrum within four months.
Brekke said Telenor would decide on whether to bid in the auction after reviewing the criteria and reserve price.
Only companies that lost the licences granted in 2008 should be allowed to bid, he said.
Of course we'll do our best to participate in an auction, he said, but added that Telenor would not blindly bid regardless of the rules and the base price.
Telenor, majority-owned by the Norwegian government, has said Norway is monitoring the situation in India and would help the company find a solution to protect its investments.
Brekke said Telenor's Indian operations would keep expanding over the next four months as if nothing has happened.
We are not dead yet. We are not even sick yet, he said.