Despite firm denials from Telecom Italia (TI), Indian newspapers are reporting that the telecoms company will spend US$2 billion acquiring a 49 per cent shareholding in Unitech -- an Indian mobile operator.
TI is said to have beaten the Norwegian telecoms operator Telenor and others in a race to acquire a stake in the Indian mobile market. Unitech has licences to provide mobile phone services in all of India's 22 service areas, but has yet to start operations. In July, Unitech's MD, Sanjay Chandra, said the company wanted to find a foreign partner within the next two months.
Chandra added that the Italian company's funds would be used for building the network, deploying services as well as bidding for 3G spectrum. TI and Unitech have been holding joint meetings with Nokia and HP in India to discuss equipment purchases related to the rollout of the new network.
Unitech apparently rejected bids from Telenor and the Middle Eastern telco Zain because both companies were looking for a majority shareholding. India permits foreign firms to own a maximum of 74 per cent in a telecoms firm. Unitech is reported to have hired over 200 people for this new venture and plans to roll out services by Q2 2009.
For more on this story:
- go to Economic Times
Investor urges Telefonica takeover of Telecom Italia. Telefonica story
Telecom Italia to cut 5,000 jobs in next two years. Telecom Italia story