Airtel’s Board Gives Green Signal on Takeover of Tata Teleservices Telecom Business

Telecom operator Bharti Airtel’s board today approved the agreement to take over the telecom arm of Tata Teleservices. Back in October 2017, Airtel announced that it’s taking over Tata’s telecom business on a ‘no-debt, no-cash basis,’ since the latter is not able to sustain the current telecom scenario. Both the companies announced the deal.

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“The Board of Director in its meeting held on December 19, 2017, has approved…composite scheme of arrangement between Tata Teleservices, Bharti Airtel and Bharti Hexacom and their respective shareholders and creditors…,” Airtel said in a regulatory filing as reported by Press Trust of India (PTI).

Under the agreement, more than 40 million subscribers of Tata Teleservices (TTSL) and Tata Teleservices Maharashtra Limited (TTML) will be moved to Bharti Airtel’s network. TTSL and TTML have operations in 19 circles combined.

“The Board also approved another scheme of arrangement between the listed entity Tata Teleservices Maharashtra (TTML) and Airtel and their respective shareholders and creditors,” added the report.

Airtel also stated that the deal would involve demerger of consumer wireless business of Tata Teleservices (TTSL) to Airtel, minus the Rajasthan circle, which will be demerged to Airtel’ subsidiary Bharti Hexacom.

Tata Teleservices reported a turnover of Rs 7,366 crore during 2016-17, which is about 12% of the turnover reported by Airtel of Rs 62,276 crore.

Airtel will be issuing 500 unlisted Redeemable Preference Shares (RPS) of the face value of Rs 100 each to all equity shareholders of TTSL equitable to their holding. The issuing also includes allotment of 10 unlisted RPS of Rs 100 face value each to all the TTSL Compulsory Convertible Preference Shares (CCPS) holders.

“The arrangement also envisages issuance and allotment of 10 unlisted RPS of Airtel of the face value of Rs 100 each to all the optionally convertible preference shares (OCPs) holders of TTSL in the proportion of their holding,” said Airtel in the filing.

“The shareholding pattern of Airtel shall change to the extent of issuance of the RPS to the shareholders of the transferor company (Tata Teleservices),” Airtel added.

The same scheme of arrangement will be followed by Tata Teleservices Maharashtra Limited (TTML) and Airtel. The equity holders of TTML will be alloted with listed shares in Airtel in the proportion of one share with a face value Rs 5 each for every 2014 shares with face value held by TTML shareholders.

“Also, all RPS holders of TTML will be issued ten unlisted RPS of Airtel (face value of Rs 100) each, on a proportionate basis,” added Airtel.

Under the deal, not only Airtel’s customer base will be bolstered, but the leading telecom operator will also gain 178.5 MHz spectrum (of which 71.3 MHz is liberalised) in the 850, 1800 & 2100 MHz bands.

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6 Comments on "Airtel’s Board Gives Green Signal on Takeover of Tata Teleservices Telecom Business"

 

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ArinShiva
December 22, 2017 10:06 am 10:06 AM

Little worried about Delhi customers, What will be the future of the CDMA Delhi customers using Voice and Data products of Tata. As we all know that Airtel only operates with GSM technology.

Airtel User
December 21, 2017 1:33 pm 1:33 PM

Chakra do write an in depth article about Docomo customers I.e. What will be the road ahead for them with Airtel. If possible circle wise with spectrum data.

gsgsha
December 21, 2017 9:38 am 9:38 AM

airtel cdma with lte like Verizon ????

KANAGADEEPAN N, Sivakasi (TN)
December 21, 2017 2:17 pm 2:17 PM

HELL NOOOOO… Tata is NOT having CDMA spectrum in Assam, NE and JK, where Airtel is Number One. With VoLTE, who needs CDMA???

Deepak Kumar Vasudevan
December 21, 2017 1:14 pm 1:14 PM

Hope like Verizon and Verizon India, Airtel does not chase its employees using goondas at a later point of time.

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