Bharti Airtel to acquire Tata's consumer mobile business

James Marshall
October 12, 2017

India's largest telco Bharti Airtel will be absorbing Tata Teleservices, Tata Group's struggling telecom business.

Airtel will not take any debt with Tata Teleservices and neither will it pay any cash for the same.

While all of the Rs 31,000 crore debt will remain with the Tatas, Airtel will assume payment of close to 20 per cent of the Rs 9,000-10,000 crore deferred payments for the spectrum to the government.

It was observed that the Boards of Tata Sons, TTSL, and TTML had also given their approval. According to the development, 4 crore users of Tata Teleservices will be transferred to Airtel on a cash-free basis.

"Tata and Bharti Airtel will work together to further explore other mutual areas of cooperation", the companies said. "It will further strengthen our already solid portfolio and create substantial long-term value for our shareholders given the significant synergies".

Tata Sons Chairman N Chandrasekaran had recently conceded that the groups mobile business Tata Teleservices is in a "really bad shape" and that a "tough call" will have to be taken on the business in this financial year. "We have evaluated multiple options and are pleased to have this agreement with Bharti".

The transaction will also provide Bharti Airtel with an indefeasible right to use (IRU) part of the existing fibre network of Tata.

Under the agreement, Bharti Airtel will acquire Tata Teleservices's consumer mobile business operations across India in 19 circles, boosting its spectrum foot print with the addition of 178.5 MHz spectrum in the 850, 1800 & 2100 MHz bands, said the statement filed with the BSE.

With the latest merger, customers of Tata will be able to enjoy India's widest and fastest voice & data network, and bouquet of Airtel's best-in-class products and services.

Tata employees will be demerged on the lines of the two businesses CMB and EFL (Enterprise and Fixed Line and Broadband), and will be moved after an optimal manpower planning.

"Tata Communications proposes to engage in exploratory discussions with TTSL and TTML regarding the potential acquisition of its enterprise business", Tata Communications said in a regulatory filing.

Other reports by Click Lancashire

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