Bharti Airtel, India's leading telecom network has reportedly in talks with Tikona Digital Networks to acquire the latter's 4G spectrum for a valuation around Rs. 800 to Rs. 1,000 crore. It was already confirmed that Airtel would buy the Norway-based Telenor's Indian unit and with this deal with Tikona, Airtel is looking to strengthen its 4G coverage in the country.
According to a report from Livemint, 'Tikona has some debt on its books which Airtel will assume, so the overall deal value is close to Rs1,500-1,700 crore. The deal will be split into multiple tranches.' That said, even after the deal Tikona will service independently, and the company currently has broadband operations 23 circles of India.
To recall, back in 2010 spectrum auction, Tikona had purchased the 20MHz of 4G spectrum in the 2300MHz band in Gujarat, Uttar Pradesh (East), Uttar Pradesh (West), Himachal Pradesh, and Rajasthan for Rs. 1058 crores. If you look at the above areas, Airtel has limited 4G coverage, whereas Tikona has a strong presence. “The idea is (for Airtel) to strengthen the overall portfolio and increase capacity to offer data. The deal will help get pan-India 4G coverage in 2,300 MHz bands...it will help Airtel fill the gaps in 2,300 MHz," reports Mint.
Mint also tried to contact Airtel and Tikona regarding the matter, but they haven't received any response as of now. The telecom sector in India has been changed after the introduction of Reliance Jio. The Telenor's deal will increase Airtel's presence in the 1800Mhz band. Telenor currently has 52 million subscribers under their belt, and after the acquisition, Airtel will have more than 320 million subscribers making it the largest operator in India.
For the uninitiated, back in 2015, Vodafone India reportedly tried to acquire Tikona, but for some unknown reasons, the company ended up buying YOU Broadband, another leading operator in the broadband space. Also, Vodafone India is now in talks with Idea Cellular for a possible merger and has already entered final stages of discussions with the latter. The Vodafone-Idea merged entity would dethrone Bharti Airtel as the leading operator in India and will also hurt in terms of revenues.