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Norway's largest information technology entity, the $4 billion Telenor Group, is planning to enter the Indian IT industry.

Telenor Venture, also based in Norway, is the group's venture capital subsidiary. Initially, the India operation will be launched through it.

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Telenor Venture CEO Rune Rinnan explains that the venture capital fund, with a portfolio of $150 million, is mainly spread among IT companies in the US, Canada, Norway and Sweden.

It is now scouting for opportunities to invest in Indian IT companies.

Discussions have been held with several Delhi and Calcutta based IT companies already. A final investment decision would be taken after evaluating Indian proposals.

After an eight-day exploratory visit to India, Rinnan told the press that the focus of Telenor Venture's activity is confined to companies in the IT and telecom sector.

At present, the company has taken venture capital exposure of between 20 and 50 per cent of the equity in 35 companies worldwide. The idea now is to downsize the exposure and spread it across 10 companies.

"Our focus is on IT and telecom companies that have potential for high growth in the medium and long term,'' Rinnan says. The venture capitalist generally exercises its exit option anywhere between three and seven years after the initial investment, he explains.

Telenor Venture, he says, prefers to be an "active investor'' involved in corporate planning at the strategic level.

Interestingly, Telenor Venture has been active in providing venture capital finance not just for seed capital but also for financing mergers and acquisitions.

In India, Telenor Venture is looking for opportunities to invest in IT companies whose activities involve areas such as geographical information systems, the Internet, multimedia etc.

"These are the areas where we will wish to take a firm decision on equity investment. Our focus will be on building value in the company we invest.''

The investment decision will be taken within the next three to six months.

Rinnan agreed on the lack of adequate and appropriate exit options available to venture capitalists in India within the existing regulatory framework.

According to him, the option to exit at any desired time is the sine qua non for the success of venture capital investment the world over.

In Calcutta, Telenor Venture was assisted by Millennium Information Systems Private Limited, an IT company that may receive venture capital from Norwegian major.

- Compiled from the Indian media

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