In Pakistan, Telenor has ruled out any consideration of merging with another company or ceasing operations.
ISLAMABAD: Telenor has been evaluTelenor has ruled out any consideration of merging with another company or ceasing operations in Pakistanating its operations in Pakistan as a result of the country’s deteriorating macroeconomic situation. 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, ASA, 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 if it can be run more effectively than it currently is, but the CEO went on to say, “We are also looking at any other types of alternatives for us to secure our value in Pakistan.
According to the sources, there are no plans for a merger or an exit from the Pakistani market, so there should be no speculation.
However, they claimed that the company was required to pay an additional sum for licence renewal as a result of a higher court’s ruling. The macroeconomic environment brought about by rising interest rates and a declining currency rate made the telecom industry’s financial problems worse.
The telecom industry had already informed the government that Pakistan’s revenue per user had sharply decreased since it was around $9 per user a few years ago, when compared to other regional markets. In the case of Pakistan, the telecom sector was rendered unviable by high taxes and inconsistent policies.
The major players were recently reviewing their operations in Pakistan, which is not good news for the market given that the government recently approved its plan to sell out more spectrum in the upcoming weeks and months.It is difficult for the telecom sector to survive in such a difficult situation because the interest rate has increased to 15% and the exchange rate has continued to fall on a daily basis.
The Ministry of IT & Telecom claims that while they have been working tirelessly to provide the right incentives for the industry, general economic difficulties have made it difficult for them to persuade economic managers to provide all necessary incentives and reduce tax burdens.
In a message to employees, the CEO of Jazz, a major player in Pakistan’s telecom industry, alluded to having to make difficult decisions, including reducing employee benefits and privileges in light of the challenging economic climate.