Bharti Airtel agrees deal to buy Tata Teleservices

By:
James Pearce
Published on:

Debt-free, cash-free deal will see 40 million subscribers added to Airtel's base, while Tata Sons will offload its troubled consumer division

Bharti Airtel has struck a deal to buy Tata Teleservices’ wireless mobile business on a debt-free, cash-free basis.

The deal will see Tata Sons offload its consumer mobile business, with Airtel assuming Tata Teleservices’ 40 million additional customers.

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," said N Chandrasekaran, chairman, Tata Sons.

The merger will also enable Bharti Airtel to further boost its 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 give Bharti Airtel, India’s largest mobile operator, the right to use Tata’s existing fibre network.

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. Tata customers will be able to enjoy India’s widest and fastest voice and data network, and bouquet of Airtel’s best-in-class products and services.”

It is the latest in a long number of big mergers announced in India this year as the sector has been locked in a price war following the launch of Reliance Jio in 2016. 

The second and third biggest mobile operators, Vodafone and Idea Cellular, are set to merge to create a new market leader, with an expected 42% share. This deal will take Airtel’s existing 35.6% share to just above 40%.