After the news surfaced that Telenor is looking for a new partner to replace Unitech, the industry has been rife with speculations, and matchmaking exercises are being conducted. Citi Global Markets India Pvt. Ltd. has reportedly been asked to negotiate and shortlist a new partner.

Several names have floated since, including the ones like Tata Teleservices and Infotel Broadband. The obvious roadblock to any joint-venture discussion with such big conglomerates, however, would emanate from Telenor’s natural expectations for a controlling stake. It is most unlikely that either Tata or RIL would find that agreeable.
What kind of companies would be possible as partners…yes, I couldn’t resist the temptation of doing a matchmaking check either.

To arrive at a list of likely partners, let’s first do a process of elimination. Of the existing telecom players, which are ones that wouldn’t be interested, given that Telenor would be looking for a controlling stake in the venture? Well, in my assessment the ones like Airtel, Vodafone, Tata, Idea and MTS would clearly stay out.

Reliance Communications would ideally want a controlling stake too, but given the ongoing pressures it faces due to its high 3G debt burden and relatively low active subscriber ratio, it may be open to discussions. It would suffice for the company to hive off just its mobile services business into a JV.

Aircel could be another potential partner too, again due to debt-burden issues that have been negatively impacting the Indian telco’s Malaysian parents’ balance sheets. Maxis Communications of Malaysia holds 74% stake in Aircel.

A third option for Telenor would be to reconsider what it is saying no to—it’s existing JV with Unitech, of course on freshly negotiated terms and conditions. That would also save it the direct and indirect costs of migrating existing subscribers to a new brand (it can’t hold on to the Uninor brand as that’s a fusion of Unitech and Telenor); the associated costs of rebranding, and various other hidden costs.

As they say, a known problem is better than unknown problems!
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