He said Axiata was of the view that Nepal had a discriminatory taxation system and inconsistent regulatory framework.
“If Axiata had continued its operations in Nepal, it would have potentially incurred higher costs,” Anwar, who is also the finance minister, said in a written reply to a question from Pang Hok Liong (PH-Labis).
Pang had asked if those responsible for the RM3.6 billion in losses would be hauled to court.
Anwar said Axiata had actively engaged with the foreign ministry and the Nepalese government to exhaust all avenues prior to pulling out of the market.
“It was a clean break with full indemnity and no liability, as well as a potential share in profits,” he added.
He also said the decision to withdraw from the Nepalese market was made “after careful consideration by the Axiata board”, which had taken into account what was best for the group and its investors.
“It was an important step to fortify and rebuild its portfolio for long-term sustainability and returns (on investments) for investors,” he said.
Anwar said that while Axiata incurred losses in Nepal, it had made a net profit of over RM25 billion since 2008 when its initial public offering was launched.
In March, government backbencher Hassan Karim likened the scale of Axiata’s losses to the debts racked up by 1MDB in demanding that Putrajaya confirm the quantum of the group’s losses through its investment in Nepal.
In December, The Star reported Axiata’s announcement that it had entered into an unconditional sale and purchase agreement with Spectrlite UK Ltd to dispose of Reynolds Holdings Ltd, which owned an 80% stake in Ncell Axiata Ltd, following its decision to exit the Nepalese market after seven turbulent years.
The telco said the disposal included a fixed payment of US$50 million as well as a conditional offer for Axiata to receive a portion of Ncell’s future distributions, subject to the company’s future business performance, net distributions through 2029 and any windfall gains during this time.
Axiata said it had considered several factors before deciding to withdraw, including the Nepalese government hitting the company with a US$434 million tax bill.