Tata to merge consumer mobile business with Airtel


Airtel logo

Bharti Airtel and Tata today announced that they have entered into an agreement to merge Consumer Mobile Businesses (CMB) of Tata Teleservices Limited (TTSL) and Tata Teleservices Maharashtra Limited (TTML) into Bharti Airtel. As a part of the deal, Airtel will take over Tata’s consumer operations across the country in nineteen circles (17 under TTSL and 2 under TTML) with over 40 million customers joining Airtel and assets of Tata CMB.

Airtel said that it will further bolster its strong spectrum foot-print with the addition of 178.5 MHz spectrum (of which 71.3 MHz is liberalised) in the 850, 1800 & 2100 MHz bands. The transaction will also provide Bharti Airtel with an indefeasible right to use (IRU) for part of the existing fibre network of Tata.

The merger is being done on a debt-free cash-free basis, except for Bharti Airtel assuming a small portion of the unpaid spectrum liability of Tata’s towards the DoT, which is to be paid on deferred basis.

The employees of Tata will be demerged on the lines of the two businesses i.e. CMB and EFL (Enterprise and Fixed Line and Broadband). Tata said that it is in initial stages of exploring combination of its Enterprise Business with Tata Communications and its Retail Fixed Line and Broadband business with Tata Sky.

Tata CMB’s operations and services will continue as normal until the completion of the transaction, which is subject to requisite regulatory approvals.

Sunil Bharti Mittal, Chairman, Bharti Airtel, said:

This is a significant development towards further consolidation in the Indian mobile industry and reinforces our commitment to lead India’s digital revolution by offering world-class and affordable telecom services through a robust technology and solid spectrum portfolio. On completion, the proposed acquisition will undergo seamless integration, both on the customer as well as the network side, and further strengthen our market position in several key circles. 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 acquisition of additional spectrum made an attractive business proposition. It will further strengthen our already solid portfolio and create substantial long term value for our shareholders given the significant synergies.

N Chandrasekaran, Chairman, Tata Sons, said:

We believe today’s agreement is the best and most optimal solution for the Tata Group and its stakeholders. Finding the right home for our longstanding customers and our employees has been the priority for us. We have evaluated multiple options and are pleased to have this agreement with Bharti.

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Author: Srivatsan Sridhar

Srivatsan Sridhar is a Mobile Technology Enthusiast who is passionate about Mobile phones and Mobile apps. He is currently using the Motorola Moto G4 Plus. You can follow him on Twitter @ssrivatsan and on Google+