Telenor and Unitech settle

Telenor (OSE: TEL) said its and Unitech Ltd (BOM:507878) have agreed to settle all disputes between them subsequent to a succesfull business transfer and spectrum auction. Further details of the settlement are confidential. Telenor said that Unitech Wireless (Uninor) business is transferred into a new entity controlled by Telenor. Unitech Ltd’s just under 33% stake in Uninor goes to Telenor for “a nominal fee”

The much publicized Indian Supreme Court decision to cancel 2G licenses including those held by Uninor following a corruption scandal led Telenor to seek massive compensation from Unitech Ltd and then a writedown on India assets. Telenor said it is currently planning to partake in upcoming spectrum auctions but will make a definite decision at a later date. Given that a settlement was reached so fast, Telenor is hardly getting anywhere close to what it was demanding, but the market did not seem to think it was going to get that much anyhow. Unitech Ltd, which is mainly involved in contruction industry, popped almost 20% in India on the news.