Telenor Group transfers $80m to Pakistan

[Lahore_Real_Estate]

Expanding network infrastructure, service quality
By Muhammad Yasir

KARACHI: Telenor Group, a Norwegian telecom giant, transferred $80 million to its subsidiary in Pakistan, which will be utilised for expansion of network infrastructure and improvement of service quality in the upcoming months, official sources told Daily Times on Tuesday.

This is one of the biggest investments made by any foreign-based telecommunication company in the country so far in the current fiscal year.

Foreign direct investment (FDI) in the telecom sector has declined to $205.4 million in July to February as compared with the landed investment recorded at $736.9 million in the same period of last financial year, showing a 72 percent decline.

Telenor official said that the investment will be spent on various existing and upcoming projects related to network infrastructure expansion and quality of service enhancement.

Number of cell sites, franchises and other infrastructure related projects will be accomplished in order to improve quality of services and network expansion throughout the country, they added.

As per Pakistan Telecommunication Authority (PTA), Telenor has established more than 6,088 sites including solar energy-run sites by the end of July 2009.

The Norwegian-based cellular phone company is ranked as second having largest subscribers’ base with 23.7 percent share in the overall users’ market. By the end of January, the total number of pre-paid and post-paid subscribers stood at 22.64 million. The company has a network of 250-plus franchises and 150,000 retailers through out the country.

It acquired majority shares of Tameer Microfinance Bank in November 2008 for $12.5 million. Subsequently launched ‘mobile accounts’ recently, a new service as part of easypaisa mobile banking services. Easypaisa was initially launched in October 2009 with bill payment and later added money transfer to its portfolio.

According to the official statistics, more than 600,000 bill payments and more than 175,000 money transfer transactions have been recorded in the last four months.

In 2009, EBITDA (Earnings before interest, taxes, depreciation and amortisation) margins grew to an all-time high of 28.4 percent. It was recorded at 1,055 million Norwegian krone (NOK) in the closing year as compared with 709 million NOK in 2008. It is estimated that Telenor Pakistan would have contributed Rs 20 billion in various forms of direct and indirect taxes to Pakistan’s economy.

Telenor Group is the country’s single largest European investor, with investments in excess of $2 billion, beginning with the acquisition of a GSM licence in 2004 for $291 million.