Sunivera Capital Ventures has moved to sign a Share Purchase Agreement (SPA) to acquire local investor Niraj Govinda Shrestha’s 20 percent stake in Ncell after Swedish company TeliaSonera, the majority stakeholder, announced it would be pulling out of Nepal.

With this, the process of transferring the shares belonging to Niraj Govinda Shrestha to Sunivera Capital Ventures owned by Bhavana Singh Shrestha has begun. Niraj Govinda Shrestha will be selling 200,000 shares in the telecom giant at Rs100 apiece as per the documents submitted by Sunivera to the Department of Industry, to start the purchasing process.

The actual value of the shares, however, will be fixed by mutual agreement between the buyer and the seller since Ncell is a private company. The two parties will reveal the true value of the transaction to the Office of the Company Registrar, based on which the Inland Revenue Department will determine the applicable taxes. Meanwhile, the Department of Industry (DoI) has agreed in principle to the transfer of the shares, according to a source at the department.

“The department has agreed in principle on the condition that the company increase its capital and capacity. As per the condition, the company has also applied to boost its capital,” the source said.

Last December, TeliaSonera announced that it would be selling 80 percent of Ncell stock, valued at Rs140 billion ($1.4 billion), to Malaysian-based company Axiata. As per the agreement initialed between the two companies, TeliaSonera will sell its 60.4 percent stake in Ncell to Axiata at around $1.03 billion. Axiata will also buy the 19.6 percent stake owned by the Visor Group of Kazakhstan.

As for the rest of the stock, TeliaSonera said that it would be dissolving its economic interest in the 20 percent stake held by the local investor Niraj Govinda Shrestha, and receive around $48 million from Sunivera Capital Ventures, a Singapore-registered company.

A source at the DoI said that Bhavana Singh Shrestha, who is going to be the local partner of Ncell, had first registered a company named Sun Glory Investment in Nepal.

Sunivera Ventures which has been formed under Sun Glory Investment is also registered in Nepal. Though TeliaSonera had stated that Singapore-based Sunivera Capital Ventures would acquire its stock, the current process has

been initiated with Nepal-based Sunivera Capital Ventures. Telecommunications Policy 2004 requires a minimum 20 percent local participation for such investment.  

According to the DoI, even though the transfer of the 20 percent local stake in Ncell has begun, TeliaSonera has not begun transferring the ownership of the other 80 percent stake. TeliaSonera, however, expects to conclude the transfer by the first half of 2016.

TeliaSonera entered Nepal in 2008 by acquiring a controlling stake in the then Spice Nepal. Established in 2004, Spice Nepal was Nepal’s first private mobile operator.