- As part of the merger, Airtel will gain 71 MHz of spectrum in three bands of 1800 MHz, 2100 MHz and 850 MHz
- TDSAT has stayed DoT's demands of Rs 8,300 crore worth of bank guarantees
The merger process between Indian’s prominent telecom operator, Bharti Airtel and Tata Teleservices has been completed, confirmed the former. The Sunil Bharti Mittal led telecom operator had decided to merge its operations with Tata Teleservices’ consumer business, and as part of that, it will acquire the telco’s customers, spectrum, assets and the outstanding dues. Starting July 1, Bharti Airtel will be making use of Tata Teleservices’ airwaves as the telecom tribunal has directed it. The companies stated in a joint statement on Monday, “Following the Hon’ble TDSAT’s order directing the DOT to take the merger on record and approval of the schemes of arrangement by Hon’ble NCLT, Delhi and Hon’ble NCLT, Mumbai, we are pleased to announce that the schemes of arrangement have become effective today July 1, 2019.”
Bharti Airtel Tata TSL Merger Details
Both of the merging telcos also added, “Consequently, all customers, assets, spectrum and agreed liabilities of the Consumer Mobile Businesses of TTSL and TTML now stand merged with Airtel.” To recall, it was back in 2017 when both the companies had announced this merger, and it has taken almost two years for the companies to complete it. Airtel will get only a handful of customers from Tata Teleservices’ actual base. Back then, when the merger was decided upon, TTSL boasted of having 40 million customers, but in April, the reported number of TTSL subscriber was only 13 million. However, out of this 13 million, only 1% of the subscribers were active on the network.
Bharti Airtel to Gain 71 MHz of Spectrum from Merger
Along with the customers and spectrum, Bharti Airtel will also be bearing the liabilities of Tata Teleservices, including dues such as spectrum payments. Earlier this year, TTSL had offered to surrender airwaves that it had previously bought in the auctions from the government. It might seem that the actual deal which Bharti Airtel has made with TTSL might not be as fruitful as it seemed back in 2017, but one of the big gains for the Sunil Bharti Mittal led telecom operator is in the form of airwaves. Bharti Airtel will stand to gain over 71 MHz of spectrum in three bands—1800 MHz, 2100 MHz and 850 MHz. These three bands are all used for 4G and given that Airtel is hastily expanding its 4G network and undergoing a 4G network upgradation exercise to compete with Reliance Jio, this addition will be very beneficial.
TDSAT Stays DoT’s Demands of Bank Guarantees
Another thing to note about the TTSL, Bharti Airtel merger is that it awaits clearance from the Department of Telecommunications (DoT) which will likely challenge the TDSAT order in the Supreme Court. In May when DoT had made a demand of Rs 8,300 crore worth of bank guarantees on the grounds of one-time spectrum charges (OTSC), the TDSAT had stayed the order citing similar stays in other merger cases in the industry by courts, including the Bombay High Court. However, the tribunal had then asked Airtel to pay up half of the Rs 1,287.97 crore demand raised by DoT as OTSC for the Chennai circle licence extension from November 30, 2014, to September 27, 2021, within four weeks. TDSAT had also given the green flag to the companies to operationalise the spectrum and undertake sequential activities.
Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.