The proposal was deferred after the Department of Telecom (DoT) raised questions on the identity of its potential Indian partner since Unitech has indicated that it will not be subscribing to the rights issue.
The need for a potential partner may arise as after the rights issue, Telenor’s stake may breach the 74 per cent foreign investment cap permitted for non-Indian telecom companies.
DoT has also sought more information on the number of shares and the pricing of shares in the rights issue. The Home Ministry has also sought more time to give security clearance to Uninor’s FIPB application.
Just a few days ago, Telenor’s Indian partner in Uninor, Unitech, had written to the FIPB claiming that the rights issue did not have the consent of its representatives in the board. They had also warned FIPB that the rights issue could lead to a breach in the 74 per cent FDI cap.
The deferment of the rights issue could come as a setback to Uninor, which is looking to fund its operational expenses through the rights issue as banks have stopped lending to companies which could lose their licences in September.
Uninor’s majority shareholder Telenor is keen to stay on in India and is looking to participate in the upcoming spectrum auction. It is rejigging its existing operations and is hoping to transfer its existing customers into a new company, which could participate in the spectrum auction.