In light of Pakistan’s deteriorating macroeconomic condition, Telenor has been reconsidering its operations there. The business, however, has ruled out any consideration of merging with another company or ceasing operations in Pakistan.
Sigve Brekke, President and Chief Executive Officer of Telenor, stated in its statement that due to writing down the value of its assets in the range of approximately $250 million, “We will definitely look at what is creating shareholder value when we do the review, but I don’t want to comment on the content of that review.
Naturally, the operation is being examined to see whether it can be operated more effectively than it now is, but the CEO went on to say, “We are also looking at any other sorts of solutions for us to safeguard our value in Pakistan.
According to the sources, there are no plans for a merger or a withdrawal from the Pakistani market, therefore there should be no speculation. However, they claimed that the corporation was required to pay an extra sum for license renewal as a result of a higher court’s ruling. The macroeconomic environment brought forth by rising interest rates and a declining currency rate made the telecom industry’s financial problems worse.
The telecom industry has already informed the government that Pakistan’s income per subscriber had sharply decreased since it was approximately $9 per user a few years ago when compared to other regional markets. In the instance of Pakistan, the telecom business was rendered unviable by high taxes and contradictory laws.
The main firms were recently reconsidering their operations in Pakistan, which is not good news for the industry given that the government just authorized its proposal to sell off additional spectrum in the upcoming weeks and months.
It is tough for the telecom industry to survive in such a challenging situation since the interest rate has increased to 15% and the currency rate has continued to fall on a daily basis.
To read our blog on “GameBird, Pakistan’s largest Esports platform powered by Telenor,” click here.
