[OSLO] Telenor will receive payments for the sale of its Myanmar operations over the next five years, the Norwegian telecoms company said on Friday as it announced the completion of the transaction.
Telenor in May 2021 wrote down the value of its Myanmar business by US$751 million and later said it would be sold for US$105 million to Lebanese investment firm M1 and local firm Shwe Byain Phyu.
"Telenor has received US$50 million at closing. The remaining US$55 million shall be received in equal instalments over the coming 5 years," it said.
"Due to the uncertain situation in Myanmar, the deferred payment will not be recognised in the accounts at closing." The sale, prompted by last year's military coup in the Southeast Asian country, has been criticised by some Myanmar civil rights groups and Norwegian politicians who fear it puts the data of 18 million people within the junta's reach.
Telenor, which last week received approval for the sale from Myanmar's rulers, says the firm had to leave the country to adhere to its own values on human rights and responsible business, and because local laws conflict with European laws.
Telenor will book an accumulated loss of around 800 million crowns (S$125.1 milllion) in its first-quarter accounts stemming from a reclassification of items it had previously accounted for.
It will also see a negative cash flow impact of 1.5 billion crowns resulting from the "derecognising of the cash balance in Telenor Myanmar and the proceeds received at closing", the company said.
Reuters reported in February that Shwe Byain Phyu, whose chairman has a history of business ties to the military, will own 80% of the Myanmar operation while M1 will own the rest.
Shwe Byain Phyu has denied ties to the Myanmar army and previously said it was "selected by Telenor ... because it was the most unrelated to the military". REUTERS