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DoT To Allow Telcos To Sell Out To 3G Auction Winners

Well, once the licenses have been handed out, and spectrum allocated, I guess there’s no harm is changing the rules of the game. Mint reports that the Department of Telecommunications (DoT) has relaxed the norms for Mergers and Acquisitions for Telecom in India – and those companies that successfully bid for the 3G spectrum, will be allowed to buy an existing license holder. Note that one of the pre-conditions for giving out licenses to new telecom players last year, was that they couldn’t sell out for three years, and had certan rollout obligations. Consequently, those who get 3G spectrum will not have to pay for the UAS License.

I’m not sure of how works for foreign players – They were reportedly not very keen on bidding for the 3G spectrum, and even if they do get the spectrum, they will still not be allowed to hold more than 74 percent in an Indian telecom company. It might help them get a better deal, leveraging their 3G spectrum with 2G players who are currently negotiating. If anything, this might just delay deals in the telecom space, until after the auctions. Among the new telecom operators, Datacom in particular has been making news. Unitech said they would finalize their partner by the next month.

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