In the aftermath of the high profile fallout from the Indian telecom corruption scandal that resulted in cancellation of Telenor’s (OSE: TEL) and Unitech Group’s licenses in the country, Telenor is saying that Unitech Ltd. has breached of contract warranties. It says that the legality and validity of the licenses was a term in the subscription agreement and it holds Unitech Ltd. liable for the breach. Unitech agreed in boilerplate form to unconditionally indemnify and hold harmless the Telenor Group.
Telenor therefore seeks compensation for all investment, guarantees and damages caused by the Supreme Court Order. Among other things it has invested around 8.9 billion NOK for the ownership portion in Uninor and is guaranteeing an 8.1 billion short-term debt. As was mentioned before, one Unitech executive is facing trial for the issue. Unitech Ltd's current market cap is near 10 billion NOK.
Telenor wants to continue operations in India and will seek a new partner. It says that Unitech partnership has no future in its view. Earlier today the Times of India wrote that Uninor has added new customers and awaits what comes of the new spectrum auctions but plans to stick around in any case.
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