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Tag: Aircel

  • RCom-Aircel merger deal collapses

    RCom-Aircel merger deal collapses

    India’s Reliance Communications (RCom) has called off a planned merger of its wireless business with rival Aircel as a result of regulatory uncertainty and opposition from some creditors.

    RCom had been planning to merge its wireless business with Aircel to create a 50:50 joint venture with Aircel parent company Maxis, in a deal aimed at reducing its debt burden by around $3 billion.

    But the company announced on Sunday that its merger agreement with Aircel has now “lapsed by mutual consent” due to “legal uncertainties” and “interventions by vested interests” – referring to creditors to the company.

    RCom will now have to pursue alternative methods of reducing its substantial debt burden of around 450 billion rupees ($6.8 billion).

    LiveMint reports that the operator now plans a fire sale of assets ranging from spectrum to real estate as part of a plan to reduce its debt by around 250 billion rupees. This will partly involve adopting a 4G focus to allow it to monitize its existing 2G and 3G spectrum.

    RCom is also planning to sell its tower business and had been seeking to fetch around 110 billion rupees from the sale, but this will need to be revised now that Aircel’s tenancies will no longer be included in the deal.

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  • Telenor India said to seek merger with RCom, Aircel

    Telenor India said to seek merger with RCom, Aircel

    Norway’s Telenor is reportedly seeking to get in on the proposed merger between Aircel and Reliance Communications.

    Telenor is proposing to combine its Indian business, customer base and spectrum with the merged Aircel-RCom entity. Under the proposed terms, Telenor would own 10% of the combined company, while Aircel parent Maxis and RCom would each own 45%.

    The report cites a telecoms industry executive as stating that negotiations between the three commenced around Christmas, but have been in limbo after the Supreme Court threatened to revoke Aircel’s license if promoted Ananda Krishnan didn’t appear for a corruption case. As part of the decision the court also issued an interim ban on the sale of Aircel’s 2G spectrum.

    Telenor is also reportedly in parallel discussions with Bharti Airtel, even though Airtel has only offered cash value for Telenor’s spectrum rather than a proposed merger. The sources stated that Telenor is eager to exit India as soon as possible and will take the Airtel deal if it will close faster.

    RCom last year agreed to merge with Sistema Shyam Teleservices as part of the wave of telecoms industry consolidation.

    A combined RCom, Telenor, Aircel and SSTL would have a total subscriber base of around 236 million, making it India’s second largest operator behind Bharti Airtel, which has nearly 260 million customers.

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  • Airtel cleared to buy 4G spectrum from Aircel

    Airtel cleared to buy 4G spectrum from Aircel

    India’s Bharti Airtel has received approval for its 35 billion rupee ($521.2 million) acquisition of 4G spectrum from Maxis-owned Aircel.

    The Telecom Ministry has agreed to allow Bharti Airtel to acquire 20 MHz of 2300-MHz spectrum in eight of India’s 22 telecoms circles.

    Airtel announced in a stock exhange filing that it has now concluded the acquisition in six of the eight circles – Tamil Nadu, Bihar, Jammu and Kashmir, West Bengal, Assam and North End.

    The operator announced it will issue a new market update once the transactions are closed for the remaining two circles of Andhra Pradesh and Orissa.

    Airtel was required to surrender 1.2 MHz of spectrum in one circle as the acquisition would have left the company is breach of regulations limiting operators from holding more than 25% of the total spectrum allocated in a single circle, sources told Press Trust of India.

    But Maxis, which owns 74% of Aircel, is facing legal action from an activist lawyer over proposed deals with Airtel and RCom. The lawyer, Prashant Bhushan, had called for the spectrum.

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