Uninor
plans to scale down its operations in 4 telecom circles - Karnataka, Tamil
Nadu, Kerala and Orissa circles, due to the cancellation of its licenses in
February 2012 by Supreme Court, in order to secure its operational funding.
The
management will strengthen 9 of its 13 commercially active circles viz UP East,
UP West, Bihar & Jharkhand, Kolkata, West Bengal, Andhra Pradesh, Mumbai,
Maharashtra & Goa and Gujarat.
The
company went through a turmoil after the cancellation of its licenses and this
affected operational funding and its resources. This move is likely to give a
push to the company and places it in a stronger financial and operational
position. The company also intends to participate in the auction with a very
strong presence in these nine circles provided auction rules permit.
Uninor
has a total of around 400 direct employees in these four circles. As it
gradually scales down, Uninor plans to evaluate possibilities of relocating
some of the employees to other Uninor circles and also provide assistance in
securing employment outside the company, said Uninor in a statement.
The
company will maintain a smaller network and remain operational in the four
affected circles. The other nine circles will continue to build up their
operations aggressively, said the statement.
The
statement said, "Following the license cancellation in February, Uninor
has faced an uncertain environment that also affects ability to secure
operational funding. With lack of clarity around the auctions continuing, the
company is now forced to take stronger steps to ensure optimal fund utilization."
“Since
the Supreme Court order, we have pursued every possible measure to take our
business forward in its current form. However, we are now forced to take this
difficult but necessary decision,” said Sigve Brekke, Managing Director,
Uninor.
“Our
plan now is to enter the auctions with a very strong presence in these nine
circles, auction rules permitting. We will focus funds, resources and all our
efforts to meet even more aggressive targets in these nine circles.”
Network
in these four circles remains operational and the scale down of operations in
these circles will be gradual. Uninor will give all its existing customers a 30
day notice before any network scale down is expected to begin. However, the
company will stop activation of any new subscribers in these four circles of
Kerala, Karnataka, Orissa and Tamil Nadu with immediate effect. Uninor has 6.8
million customers in these 4 circles of which 46% are active on VLR as reported
by TRAI.
Uninor
will closely work with each of its distribution channel partners in these four
circles to enable liquidation of market stock or compensation as needed. The
company will work jointly with its business partners to together recast several
agreements in line with the new focus.
“As
things stand today, we do not foresee the need for any major changes after this
in our circles. We plan to use the remaining months to aggressively build
operations in these nine circles. Rules permitting, we will enter the auctions
fighting fit,” said Brekke
Posted in: Telecom News
