Karachi, Dec 7 (IANS): Ownership of Pakistans second-largest cellular service provider may soon change hands as Telenor Pakistan looks to exit the country amid growing cost of doing business and shrinking prospects, according to a media report.
As per those privy to the development, Telenor Pakistan is said to be in talks with an Emirates-based multinational telecom firm to sell its operations, Dawn reported.
Although a spokesperson for Telenor Pakistan declined to comment on the development, insiders told Dawn that talks between the Emirati firm, which already has a strong presence in Pakistan, and Telenor have reached an "advanced stage".
"The Emirati company already has a sizable presence in Pakistan, in nearly all key areas of the telecom sector and it is interested in further consolidating its position," the source said.
Citing the growing cost of doing business as the key reason behind the sale, the source said that the company had started suffering losses due to the swift appreciation of the US dollar, Dawn reported.
The company's operational costs have touched $55 million, the source said, pointing out that the largest chunk of this was consumed by electricity prices — documents show that in the outgoing financial year, the company paid around $17 million in power bills alone to keep its infrastructure running.
In view of this, experts say it is understandable that Telenor Pakistan would look to cut its losses and — from the company's perspective — prefer to expand into a region where business prospects or rates of return are better than in Pakistan.
The company had reportedly set an asking price between $1 billion and $1.2bn, but the interested party is looking to spend $780-910 million on the acquisition.