According to Swedish business magazine Veckans Affärer, the 4.2 billion kronor ($624 million) TeliaSonera paid in 2008 for its stake in Nepalese telecom operator Ncell ended up with a company controlled by to Raj Bahadur Singh, the son-in-law of the deposed king.
The money was funneled through a number of shell companies in several countries, including Kazakhstan and Cyprus, the magazine reports.
The magazine describes Bahadur Singh’s 2004 acquisition of Ncell as a “confiscation” whereby he took over the company from two other shareholders just prior to Ncell being awarded licences to operate mobile phone networks in the country.
Authorities have recently launched a probe into TeliaSonera’s purchase of Ncell and its ties to the king’s son-in-law stemming from suspicions of bribery, corruption, and tax fraud, according to Vekans Affärer.
However, TeliaSonera claimed the report contained “a number of errors and speculation”, claiming Ncell was bought through Visor, an established investment firm in Kazakhstan.
“We were not able to review the material before it was published so we’re now reviewing the article,” company spokesperson Thomas Jönsson told the TT news agency.
The revelations are the latest in a string of reports which have raised questions about deals struck abroad by TeliaSonera, in which the Swedish state has the largest ownership stake.
Swedish prosecutors recently launched a corruption investigation into a deal forged between TeliaSonera and a company in Uzbekistan with links to the family of the former Soviet republic’s authoritarian president.
Telecoms consultant Bengt Nordström explained that TeliaSonera has likely sought to do business with questionable regimes for from its home region because of the allure of higher profits.
“In the west, mobile phone penetration is over 100 percent and there is a lot of competition,” he told the TT news agency.
“That they instead look to emerging markets is a trend that’s been ongoing for the last ten years.”
According to Nordström, most companies conclude that the upside of new profits outweigh the downsides of having ties to governments which have come under fire for corruption or rights abuses.
He explained that the Swedish government has previously viewed the export of technology to non-democratic countries as a first step in democratic development.
“The [Swedish] state, as an owner of Telia, acts and thinks today, and considering the media’s treatment of Telia, may decide that they can no longer be owners of operations east of Finland and south of the Alps,” said Nordström.