Tata Teleservices to merge its Consumer Mobile Business with Bharti Airtel

Bharti Airtel To Acquire Tata's Mobile Business But Not Its Debt

Bharti Airtel To Acquire Tata's Mobile Business But Not Its Debt

Tata Group has entered into an agreement with Bharti Airtel to merge the consumer mobile businesses of Tata Teleservices Limited and Tata Teleservices Maharashtra Limited to India's largest telecom player- Bharti Airtel. It will also assume a small portion of the unpaid spectrum liability of Tata towards the Telecom Department, which is to be paid on deferred basis, the statement added.

Bharti Airtel Chairman Sunil Bharti Mittal was quoted by IANS saying, "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". Any such transaction will be subject to respective boards and other requisite approvals. "It will further strengthen our already solid portfolio and create substantial long-term value for our shareholders given the significant synergies".

Furthermore, this transaction also includes transfer of all the assets of Tata CMB to Airtel which would enable the latter to strengthen its footprint in the 850, 1800 and 2100 MHz bands. Having said that, Tata will retain its stake in Viom while taking care of all the liabilities associated with it.

Bharti Airtel will absorb the operations of TTSL and TTML across the country in 19 telecom service areas, it added.

"The acquisition of additional spectrum made an attractive business proposition".

This comes after Tata Sons Chairman, N Chandrasekaran, said Tata Teleservices was in a "really bad shape" with Rs. 31,000-crore debt.

Tata Communications pointed that in the normal course of operations, it looks at potential opportunities in various markets in the best interest of the company. 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. Goldman Sachs (India) Securities Private Limited is financial adviser to Tata.