UPDATE 1-Telenor signs up new Indian JV partner for auction

Last Updated: Fri, Oct 26, 2012 08:50 hrs

* Telenor to hold 74 pct of India JV after deal with Lakshdeep

* Enables Telenor to take part in licence auction planned to start in Nov

* Says still hasn't made decision on whether to participate in auction or not (Adds detail, analyst)

OSLO, Oct 26 (Reuters) - Norway's Telenor will bring Lakshdeep Investments & Finance Pvt. Ltd into its new Indian Telewings venture to bid jointly for new mobile telephone licenses, Telenor said on Friday.

Lakshdeep replaces Unitech as Telenor's Indian partner after authorities cancelled their Uninor venture's licenses granted in a corruption-tainted 2008 licensing round.

Lakshdeep, a company controlled by Sudhir Valia, will contribute an undisclosed amount of equity into the new Telewings joint venture, in which Telenor will hold a 74 percent stake, Telenor added.

Telenor has already submitted an application for prequalification in the upcoming auction as it aims to stay in the country despite being stripped of its permits.

Indian courts cancelled 122 regional operating permits held by eight carriers earlier this year, forcing operators to reapply for their permits.

Friday's deal makes it possible for Telenor to take part in next month's auction of Indian mobile telephone spectrum as local rules allow a maximum 74 percent shareholding by foreign companies in telecom carriers.

"A final decision on whether to participate or not will be made before the auction starts," Telenor said.

"These are people who enable international ownership," said Espen Torgersen, analyst at Carnegie. "I expect that the risk for the financial investor to be very much reduced, and probably also the upside." (Reporting by Victoria Klesty, additional reporting Joachim Dagenborg; Editing by Balazs Koranyi)

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