Telenor: No plan B for Pakistan, exit now

Details: Manny Pham; Category: Operators; 09 July 2025; 27415 views

Telenor’s planned exit from Pakistan is currently being held up by the country’s competition authority – a delay the Nordic group argues is stagnating digital development in the South Asian nation.

Speaking to Developing Telecoms, Telenor Asia head Jon Omund Revhaug (pictured, below) said the operator no longer has the capital, nor can it foresee the scale required to fund the large capex needed to push Pakistan into the 5G era and beyond. The group is instead focusing on Asian markets where it can hold leading positions.

Headquartered in Singapore, Revhaug oversees Telenor’s interests in Bangladesh, Malaysia, Thailand and, for now, Pakistan. At its peak, the group’s Asian footprint extended to India and Myanmar – the former exited due to similar structural challenges to those in Pakistan, and the latter abandoned following a military coup which made operations untenable, with demands from the junta to install spyware on the network.

Now, Telenor is focused on further withdrawing from South Asia.

Taking charge of this latest divestment is Revhaug, a 25-year Telenor veteran who has worked across its global footprint, particularly in Asia. He played a key role in major recent mergers, including the creation of CelcomDigi in Malaysia and True Corporation in Thailand. Telenor also maintains its original foray into Asia with Grameenphone in Bangladesh.

Jon Omund Revhaug

West of Bangladesh, Revhaug is leading the execution of Telenor’s modernisation and efficiency strategy. In 2023, the group announced its intention to sell its Pakistani unit to Pakistan Telecommunication Company Limited (PTCL), which operates the Ufone brand.

“We were quite early in understanding that this growth was going to flatten, and we needed to think differently to manage this portfolio of assets,” said Revhaug. “We established a phase of modernisation to drive efficiency across our operations.”

He explained that the group anticipated slowing growth as far back as 2017, when market trends began shifting from voice to data – a change that required “significant investments in infrastructure over time” to stay competitive. Telenor, he said, will only remain in markets where it sees a clear path to becoming a top-two operator.

Pakistan, after extensive evaluation, was deemed too challenging. While a merger – as had been pursued in Malaysia and Thailand – was considered, Revhaug conceded: “We did not find a solution that would lead us to a number one position [in Pakistan].”

According to the Pakistan Telecommunication Authority, Jazz led the market in May with around 74 million monthly mobile subscribers, followed by China Mobile-owned Zong with 52 million. Telenor ranked third with 44 million, while PTCL’s Ufone had 27 million.

A merger between Telenor and Ufone would create a stronger rival to Jazz and introduce much-needed competition, with the scale and capital to invest in future infrastructure, argued Revhaug.

“Over the last 11 years, Telenor has invested USD 2.4 billion in Telenor Pakistan, and we believe significantly higher investments will be required going forward – especially with 5G coming into the market soon.”

However, he said, several factors make such growth unfeasible:

“Pakistan has some of the lowest average revenue per user (ARPU) rates in the world, high spectrum costs, low service profitability, and no regulatory outlook to support in-market consolidation. The reality for the business and the industry at large simply didn’t support continued investment.”

“All of these factors led to our decision. We’ve executed on that decision, and our funds are now tied up in the mergers we’ve completed in Malaysia and Thailand. Our decision to exit Pakistan remains very firm.”

Stalling sale

Telenor had forecast in recent financial results that the divestment would complete before the end of H1 2025. At the time of writing, the transaction is nine days overdue – a delay that has caused “concern” within the group.

Revhaug said the matter is now in the hands of the Competition Commission of Pakistan (CCP), stressing that Telenor is not part of PTCL’s application process to acquire the assets. He recently travelled to meet with CCP chairman Dr Kabir Ahmed Sidhu, and Pakistan Telecommunication Authority (PTA) chairman Major General Hafeez Ur Rehman.

“We have good reason to believe and understand that PTCL has fully complied with CCP’s queries, and that there are currently no outstanding questions,” said Revhaug.

“The PTA is very supportive of the transaction, because they recognise the same need I’ve just outlined. Major General Rehman clearly sees that the industry needs significant investment to move towards a data-enabled, modern society.”

Revhaug warned that further delays to the sale would stall Pakistan’s digital and connectivity development. This has already been illustrated by the long-awaited 5G spectrum auction being put on hold – reportedly due to PTCL withholding key documents the CCP needs to evaluate the deal, according to IT and Telecommunications Minister Shaza Fatima Khawaja.

If delays continue, Revhaug said Telenor will not participate in any new spectrum processes due to the capital required for deployment.

“I see no reason to open a licence under the current structure in Pakistan, and we will not participate in that. The current structure doesn’t support the economics of building out that infrastructure. Some form of industrial change is needed for it to become viable. So our position is we will not enter such a licence process – not under almost any circumstance. We do not have a plan B.”

He added: “There will be a deterioration in our ability to create and develop services – and, consequently, how we serve all our markets – if the sale is not approved.”

Revhaug pointed to Malaysia and Thailand as examples of how Telenor’s mergers had created “significant synergies”, resulting in stronger competitors with the financial strength to invest. However, he acknowledged that both countries are more advanced telecom markets, while Pakistan is still at the beginning of its 5G journey – which will remain on hold until the PTCL acquisition is approved.

“The industry is evolving, and we have a limited amount of resources. We will invest them in markets where we can reach a number one position.”

Telenor’s Asian restructure has been a success, claimed Revhaug, noting that the group’s equity value has grown “significantly” – from NOK 79 billion (USD7.8 billion) pre-restructure to NOK 93 billion (USD8.2 billion) today.

This “uplift” has cemented Telenor’s commitment to its exit strategy. “I don’t see us changing that anytime soon. We don’t have a plan B [for Pakistan],” said Revhaug. “The benefit for Pakistan and the industry should be quite obvious – in terms of creating scale that enables stronger capabilities and a more competitive market. That would benefit consumers and businesses alike.”

Telenor is not wavering in its decision to leave Pakistan. Revhaug is already turning his attention to strengthening the group’s remaining Asian units in Bangladesh, Thailand and Malaysia – soon to benefit from resources freed up post-exit.

He added that artificial intelligence is playing an increasingly central role in this future, calling it machine learning “on steroids” – something Telenor has been deploying well before the recent hype.

“There are two ways to apply AI. The first is around driving efficiency – that will be instrumental for any operation. But outperforming others based on efficiency alone will be harder, because companies can simply buy the same AI capabilities.”

“The real advantage will come from using new technology to drive service innovation – creating differentiated, useful services that customers adopt. That will be critical moving forward.”