Tikona Digital Networks has shut down operations in 13 of 38 cities with an intent to consolidate coverage, reports The Economic Times. The company plans to expand its coverage and capacity in the top six metros and 19 Tier-I cities. The report also states that there’s a possibility of a stake sale in the company, however, Tikona has denied these claims.
Apart from that, the company has uprooted its entire network from the cities it has exited, so that it can re-use the equipment elsewhere. Tikona employees also reportedly suffered from salary cuts, however, Tikona has denied this claim. The company claims that its consolidation strategy had a significant impact on its EBITDA (earnings before interest, tax, depreciation and amortisation). The company also claims that it is on the path of achieving breakeven after just four years of commercial operations.
Future plans: Earlier this year, there were reports that Tikona was looking to raise another Rs 1,000 crore to buy 4G network gear. The company had even floated a request for proposals (RFP), inviting bids for 4G equipment. Tikona has 4G licences in five circles including Gujarat, Rajasthan, Uttar Pradesh-East, Uttar Pradesh-West and Himachal Pradesh. Initially, it plans to roll out its 4G network in Gujarat and Rajasthan region. Tikona had won 4G licenses for these circles in the 2010 BWA auction for which it paid Rs. 1,058 crore.
Currently, Tikona offers Wi-Fi data connectivity to home consumers and small enterprises. For 4G, Tikona has plans to offer integrated 4G and WiFi services.
Tikona Digital Networks, founded by Prakash Bajpai, has been funded by Goldman Sachs, Oak Investment Partners and Everstone Capital Advisors, who own 71% in the company.