Telenor aims to buy its way back into Indian mobile market after losing licenses

After losing its previous Indian mobile network operating licenses to a court order, the company will bid in a new spectrum auction

After an Indian court took away its licenses to operate mobile networks in the country, Telenor said Friday it hopes to buy them back in a new mobile spectrum auction.

The Norwegian company has applied to take part in the auction for spectrum in the 1800MHz band organized by India's Department of Telecommunications.

The move follows a decision by India's Supreme Court in February to cancel 122 licenses to operate 2G mobile networks that were issued in 2008, as it found they had been purchased by business entities that manipulated the system. The court ordered the Telecom Regulatory Authority of India to auction the licenses and spectrum released as a result.

Among these licenses were 22 that had been assigned to Telenor, as well as licenses allotted to the Indian joint ventures of Etisalat, Sistema, and NTT DoCoMo.

The amount the foreign operators paid for their stakes in joint ventures was far higher than the Indian companies had earlier paid for the licenses, which were offered at basement prices in 2001, the court said in its ruling.

Telenor said it is scouting for a new Indian partner, and the assets of its earlier operation will be transferred to the joint venture. It recently concluded an agreement with its former Indian partner. Indian rules limit foreign ownership in telecommunications services companies to 74 percent of the equity.

The operator will compete in the auction with Indian players and with some other foreign players aiming to regain their lost mobile licenses in a now-booming market.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com

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John Ribeiro

IDG News Service
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