Norwegian Telecom major Telenor has said that lenders of its Indian arm, Uninor, have issued default notices to the firm as payment.
According to latest quarterly result statement issued by Telenor, as of July 23, Telenor ASA has received guarantee claims of total NOK 3.6 billion (Rs 3,382 crore) and default notice from most of the lenders.
"One of the lenders has turned down a request for an extension of borrowings given to Uninor, and has demanded payment under the Telenor ASA guarantees," Telenor said without mentioning the name of the lender.
"This event has triggered cross-default under the loan agreements. As of 23 July Telenor ASA has received guarantee claims of total NOK 3.6 billion and default notice from most of the lenders. The remaining banks are expected to follow shortly," it added.
An email sent to Uninor through its PR agency seeking comments yielded no reply.
Telenor said that Uninor had NOK 9.6 billion (Rs 9,019 crore) in current interest-bearing borrowings, all with financial guarantees from Telenor ASA as of June 30, 2012.
Uninor's loan agreements contain typical bank loan provisions including material adverse effect clauses.
As of June 30, 2012, Uninor had NOK 1.1 billion in bank guarantees from the State Bank of India with counter guarantee from Telenor ASA.
"As a consequence of the 2G auction recommendations on April 23, 2012 from the Telecom Regulatory Authority of India to the Department of Telecom, an impairment loss of NOK 3.9 billion (NOK 2.6 billion attributable to Telenor) was recognised in the first quarter of 2012 relating to the remaining tangible and intangible assets in Uninor as of 31 March 2012," Telenor further said.
In February, the Supreme Court had ordered the cancellation of 122 telecom licences -- including 22 held by Uninor, a joint venture between Telenor and Indian real-estate firm Unitech.
Telenor is seeking to scrap the JV with Unitech which holds 32.75% stake in Uninor and plans to migrate its business to a new company. The rest is held by Telenor.
Despite the challenging regulatory situation, the number of subscribers of Uninor increased by 2.2 million during the quarter (April-June) taking the total subscriber base to 33.7 million, Telenor said.