Vodafone, the country’s second largest telecom operator by subscribers, is likely to acquire You Broadband for around Rs 400 crore, in a bid to increase its competitiveness in high data consuming cities against Reliance Jio, which is widely expected to launch commercial operations later this year, the Economic Times reported.
The acquisition talks have reached advanced stage, the report said, quoting multiple people aware of the development.
TRG Capital-owned You Broadband has around 3,000 kilometers of optic fibre and 6,000 kilometers of last mile cables to homes across 12 cities, the report said, adding the key market for You Broadband is Mumbai, which will be a data battle ground for all the telcos once Jio launches services.
Jio has investment much of the capital expenditure in deploying its own fiber in the country, and it feels that it would provide it with competitive edge over incumbents in the country. The deal would enable Vodafone strengthen its fiber-backhaul reach in the country.
The fiber backhaul for wireless networks, analysts say, can considerably improve the capacity of a tower or signal emitting point compared to doing it entirely over airwaves.
According to the report, investment bank Rothschild advised Vodafone, while ICICI Securities was the investment banker to You Broadband.
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