Bharti Airtel, Tata to merge consumer mobile businesses

Bharti Airtel, Tata to merge consumer mobile businesses”

Bharti Airtel will acquire Tata Group's loss-making mobile telephony business, nearly for free, boosting its spectrum holding and raising subscriber base while saving the Tatas from the prospect of having to shut down the struggling unit.

The transaction will be done on a "debt-free cash-free" basis, the companies said in their joint statement, although Bharti Airtel will take over a "small portion" of Tata's unpaid spectrum liabilities.

The Boards of Bharti Airtel, Tata Sons, TTSL and TTML have approved the transaction.

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.

"This is a significant development towards further consolidation in the Indian mobile industry. The 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".

The merger will also provide Bharti Airtel the right to use Tata's existing fiber network.

He said Tatas will retain stake in the tower company, Viom, and explore transferring the enterprise business to Tata Communications and retail fixed-line and broadband business to satellite TV arm Tata Sky. "We have evaluated multiple options and are pleased to have this agreement with Bharti". This comes after 4 months of continuous talks between the two companies and finally, N Chandrasekaran, the head at Tata Sons can look to focus on other verticals of Tata Sons as the telecom business was one of the loss-making verticals of the Tata Sons.

"The acquisition of additional spectrum made an attractive business proposition". The agreement will further strengthen Airtel's solid portfolio and create substantial long term value for our shareholders given the significant synergies.

Tata Teleservices and its unit Tata Teleservices (Maharashtra) Ltd have more than 40 million subscribers and rank ninth in India's telecoms market, which had a total of 1.2 billion mobile subscriptions at the end of July.

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