India's MTNL denies delisting rumors

07 Jul 2015
00:00
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Daily News

Indian state-owned operator MTNL has denied rumors it plans to delist from the Bombay Stock Exchange (BSE), and is being pressured to complete an order for equipment from Nokia.

MTNL has issued a clarification letter to the BSE insisting that no proposal to delist is under the consideration of the board, the Press Trust of Indiareported.

The company was forced to clarify after rumors of the delisting forced its stock price up nearly 20%. MTNL has been struggling with losses and a declining subscriber base, prompting the speculation over a delisting.

Meanwhile the Indian government has revealed it expects to make the decision over whether to merge MTNL with fellow state-owned operator BSNL within four or five months.

The telecom ministry recently received a feasibility study into the proposed merger that it had commissioned from IIM Bangalore.

Telecom secretary Rakesh Garg has announced that the ministry will take the next 4-5 months to study the proposal before making the final decision.

Separately, Nokia has called on the telecom ministry to intervene to compel MTNL to complete an order for 2G and 3G equipment, the Economic Timesrevealed.

Nokia won a tender for an MTNL GSM network expansion project in Mumbai and Delhi nearly 18 months ago with a bid of 11.39 billion rupees ($179.8 million).

But MTNL has so far not purchased the equipment, even after Nokia's Indian unit submitted a bank guarantee and made arrangements to ensure delivery of the equipment with its own factories and suppliers.

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