Telenor says sale of Myanmar unit will get remaining approval from junta

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SINGAPORE — Myanmar’s junta has given the ultimate approval for the sale of Norwegian telecommunications firm Telenor’s operations within the nation to an area firm and a Lebanese funding agency, the agency stated on Friday.

Telenor CEO Sigve Brekke stated in an announcement the agency needed to go away the nation to “adhere to our personal values on human rights and accountable enterprise, and since native legal guidelines in Myanmar battle with European legal guidelines.”

“The safety scenario is excessive and deteriorating, and we should make sure that our exit doesn’t enhance the security danger for workers,” he stated.

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Reuters reported the approval earlier on Friday, citing three sources with information of the deal.

In line with a letter of approval despatched on March 15, seen by two of the individuals, the switch of Telenor’s Myanmar unit to its new homeowners should occur inside 5 days.

Myanmar authorities didn’t instantly reply to phone and e mail requests for remark.

“The final yr has been an especially tough scenario, I believe it’s the most difficult Telenor has ever needed to deal with, much more for the individuals dwelling on the bottom,” Brekke advised Reuters.

LONG PROCESS

Telenor, one of many largest overseas buyers in Myanmar, sought to depart the nation after final yr’s army coup. The corporate advised Reuters in September it was promoting its operations to keep away from European Union sanctions after “continued stress” from the junta to activate intercept surveillance know-how.

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Its departure from a rustic that accounted for 7% of its earnings in 2020 has been mired in problem.

Army leaders late final yr rejected its plan to promote its native operations to Lebanon’s M1 Group for $105 million, Reuters reported. As an alternative, they needed M1 to accomplice with an area agency, Shwe Byain Phyu.

Reuters reported in February that Shwe Byain Phyu, whose chairman has a historical past of enterprise ties to the army, will personal 80% of the unit whereas M1 will personal the remaining.

Telenor solely learnt “a few months in the past” who would grow to be the brand new majority proprietor, Brekke advised Reuters. “We’ve not been concerned in discussions as such.”

Shwe Byain Phyu has denied ties to the Myanmar military and beforehand stated it was “chosen by Telenor … as a result of it was essentially the most unrelated to the army.”

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In its assertion, Telenor stated the settlement to promote the Myanmar unit was with M1 alone, however added that the “regulatory approval requires that M1 ensures an area majority proprietor after the closing of the transaction between Telenor and M1.”

The agency stated on Friday that M1 had knowledgeable Telenor that its native accomplice, Shwe Byain Phyu, can be the 80% proprietor after the transaction.

“Sanctions screening from exterior consultants has assured Telenor that Shwe Byain Phyu and its homeowners will not be topic to any present worldwide sanctions,” Telenor stated.

“The explanation for sanctions is that there are shut ties between people and corporations and the army,” Brekke stated. “Realizing that the Shwe Group isn’t on the sanctions record has been essential for us.”

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M1 stated in an announcement that it had partnered with Shwe Byain Phyu Group to type a three way partnership to take over possession of Telenor Myanmar known as Investcom PTE.

The corporate stated it could work with stakeholders to shut the transaction as “quickly as doable.”

CEO Azmi T. Mikati stated within the assertion that, “M1 Group is dedicated to help Investcom PTE in offering important communications providers and investing to develop the telecommunications infrastructure.”

Shwe Byain Phyu didn’t reply instantly to requests for remark by Reuters.

Reuters reported earlier in March that Telenor is planning to switch $100 million held by its Myanmar operations to the unit’s new consumers – an quantity roughly equal to how a lot it is going to be paid over 5 years, three individuals with information of the deal’s phrases stated.

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Senior overseas Telenor executives had been barred from leaving Myanmar whereas negotiations across the sale had been ongoing, a junta minister advised Reuters final yr.

Two of the sources stated a senior Telenor Norwegian overseas government had just lately obtained permission from authorities to fly out.

An organization spokeswoman stated in an announcement that “one Norwegian worker has been allowed to depart after 10 months of being banned from leaving Myanmar.”

Civil rights teams have stated the deal may put the information of 18 million individuals inside the junta’s attain and known as on Telenor to delete private info of shoppers.

Telenor has stated doing so would violate native legal guidelines and expose staff to hazard. (Reporting by Fanny Potkin, Poppy McPherson and Gwladys Fouche; enhancing by Kenneth Maxwell and Jason Neely)