Bharti Airtel has finally completed its acquisition of Telenor India after receiving the relevant regulatory approvals.
Originally agreed in February 2017, the long-awaited deal has received final approval from the Department of Telecommunications (DoT), which has transferred all of Telenor India’s 4G licences and liabilities to Airtel.
The approval is a swift turnaround from the DoT, which just days ago was demanding that Airtel should provide a bank guarantee of INR15 billion ($222 million) – the equivalent of one-time charges for spectrum allocated without an auction - before it would green-light the deal. The Telecom Disputes Settlement and Appellate Tribunal dismissed the condition, although Airtel has paid the requested INR2 billion for Telenor’s spectrum.
The acquisition will see the Airtel boost both its subscriber base and – significantly - its spectrum holding. Telenor India held 43.4MHz of 1.8GHz spectrum across seven telecom circles. The market leader confirmed that its next step will be to fold these operations into its own.
Airtel will absorb Telenor India’s 38 million mobile connections, bringing its total up to roughly 340 million and increasing its market share by 3% to a total of 28%. However, not all of Telenor India’s staff may be accommodated, with the Economic Times reporting that the market leader was “very unlikely to fully absorb Telenor India’s near 1,200-odd staff”.
Addressing this speculation, a spokesperson said: “Airtel has already on-boarded 700 employees from Telenor India. The plan for the remaining employees will be communicated in due course.”
The acquisition is part of a country-wide trend towards consolidation spurred by the entry of Reliance Jio into the market in September 2016, which shook up the market by offering 4G voice and data services for a very low cost. Airtel is aiming to compete more effectively against the newcomer and its established rivals, including Vodafone India and Idea Cellular, which are currently in the process of merging to create a new market leader.
