Bharti Airtel acquires Telenor India amid Vodafone-Idea merger plan

Telenor India’s operations and services will continue as normal until the completion of the transaction, the press release said.

The cost of the acquisition or the price at which the shares are acquired are yet to be finalised. Photo: Reuters

After months of speculation, Bharti Airtel on Thursday announced that it has entered into a definitive agreement with Telenor South Asia Investments Pte Ltd (“Telenor”) to acquire Telenor (India) Communications Private Limited (“Telenor India”).

Bharti Airtel is the largest telecom service provider in India with 269 million subscribers and Telenor has 44 million.

In a regulatory filing, Bharti Airtel said that as part of the agreement, it will acquire Telenor India’s running operations in seven circles - Andhra Pradesh, Bihar, Maharashtra, Gujarat, UP (East), UP (West) and Assam. These circles represent a high population concentration and therefore offer a high potential for growth.

However, the cost of the acquisition or the price at which the shares are acquired are yet to be finalised.

According to the agreement, Airtel and Telenor India will merge and Airtel will take over Telenor India as soon as all necessary approvals are received. As part of the agreement, Airtel will take over outstanding spectrum payments and other operational contracts, including tower lease.

Commenting on the big deal, Gopal Vittal, Managing Director and CEO (India and South Asia), Bharti Airtel, said, "On completion, the proposed acquisition will undergo seamless integration, both on the customer as well as the network side, and further strengthen our market position in several key circles. The customers of Telenor India will now be able to enjoy India’s widest and fastest voice & data network, and a range of Airtel’s world-class products and services.”

Sigve Brekke, Chief Executive Officer of Telenor Group, said, “We believe today’s agreement is in the best interest of our customers, employees and Telenor Group. The decision to exit India has not been taken lightly. After thorough consideration, it is our view that the significant investments needed to secure Telenor India’s future business on a standalone basis will not give an acceptable level of return.”

As per the filing, the proposed acquisition will include transfer of all of Telenor India’s assets and customers, further augmenting Airtel’s overall customer base and network.

It will also enable Airtel to further bolster its strong spectrum foot-print in these seven circles, with the addition of 43.4 MHz spectrum in the 1800 MHz band.

Telenor India’s operations and services will continue as normal until the completion of the transaction, the press release said.

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