Fitch Ratings has revised Norway-based telecommunications provider Telenor's Outlook to Negative from Stable. At the same time the agency has affirmed Telenor's Long-term Issuer Default (IDR) and senior unsecured rating at 'BBB+' and affirmed the Short-term IDR at 'F2'.The Negative Outlook follows Telenor's announcement that it is considering alternatives to the previously announced NOK12bn equity issue that was to be used to finance the group's entry into the Indian mobile market.
On 28 October 2008 Telenor announced that it will inject US$1.1bn for a 60% interest in Unitech Wireless, a greenfield mobile operator. This capital injection will be used to cover the initial funding requirements for the next three years, including the accumulated estimated capex of US$2bn. Although Telenor had initially stated that the majority of the Unitech investment will be financed through a NOK12bn equity issue to be completed during Q1 '09, which in Fitch's opinion would have allowed it to retain a credit profile in line with a 'BBB+' rating, management is now evaluating other alternative options including new debt, asset sales and lower dividends.

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