“We have no other option. The company has already advertised in newspapers for shifting our customers on other network through MNP (Mobile Number Portability),” a Loop Telecom spokesperson said.
The decision would impact about 6,000 subscribers in 13 circles but not in Mumbai, where the service is run by Loop Mobile with over three million subscribers.
“This activity does not impact our operations in Mumbai under Loop Mobile as this is a separate licence. Operations in Mumbai will continue and subscribers in Mumbai remain unaffected,” he said.
Loop Telecom has started the process of issuing job termination notices to all its employees following its plan to shut down business in India.
“We have no other option. All employees have been made aware. We will soon issue them formal notice,” the spokesperson said.
Loop Telecom has around 150 direct employees, he said. Loop Telecom, which had 2G telecom licence for 21 circles, operated in 13 circles with largest subscriber base of over 2,300 in Kolkata, followed by Odisha with 965 subscribers by end of February 2012, as per telecom regulator TRAI In February, Loop Telecom had written to Prime Minister Manmohan Singh saying it will surrender the licence if the government refunds Rs 1,454 crore fee along with interest.
It has become the third operator to wind up operations in the country, after S Tel and Etisalat DB.
S Tel, a joint venture between Bahrain Telecom and Chennai-based Siva Group, was the first telecom company to announce closure of its operations.
Later, UAE-based Etisalat also announced exit from its joint venture Etisalat DB.
Etisalat has also written off about USD 820 million worth value of its Indian operations by way of an impairment charge as an after effect of the order.
The Supreme Court, on February 2, had ordered cancellation of 122 licences issued by the then Telecom Minister A Raja in 2008 and asked government to auction the 2G spectrum thus released within four months.
Another telecom operator Uninor's foreign partner Telenor has, however, has said it plans to continue its operations in India and will participate in the auctions.
Sistema Shyam Teleservices (SSTL) has also expressed similar views and has invoked a bilateral treaty between India and Russia to seek protection of its USD 3.1 billion investment in India.