Nikhil adds: Since this story went up, Airtel’s PR agency has been calling us, asking us to remove the story because their tweet, which confirmed the acquisition, went out earlier than planned. We don’t see why that should be reason enough to pull down a story.
Update: Airtel’s CEO Gopal Vittal has confirmed the spectrum acquisition in a tweet. An Airtel spokesperson told MediaNama that the deal is subject to regulatory, shareholders and other customary approvals.
We missed this earlier.
Bharti Airtel is eyeing at more 4G spectrum after the entry of Reliance Jio, a 4G-only telecom operator with a presence in all 22 circles. Airtel, on the other hand, has 4G operations in 21 circles and has already announced a merger deal with Telenor to place itself in a better position to compete with Jio.
A Mint report last week said that Airtel was in initial talks with broadband Internet Service Provider (ISP) Tikona Digital to acquire the latter’s 4G spectrum for an approximate price between Rs 800-1000 crore. A spokesperson from Airtel declined to comment on the report when MediaNama sought a confirmation. Tikona is yet to provide a response to our query.
According to the report, Tikona might separate its broadband business from its core business, and run the broadband service as an independent brand. The company had won 20 MHz of the 2300 MHz band (used for 4G) in 5 service areas including Gujarat, Uttar Pradesh (East), Uttar Pradesh (West), Rajasthan and Himachal Pradesh during 2010 broadband spectrum auctions. Airtel does not have 4G spectrum in UP circles (East and West), and the deal will primarily help Airtel to strengthen its 4G portfolio in these circles, added the report.
Vodafone tried buying Tikona but instead acquired YOU Broadband
Note that Airtel’s rival Vodafone had earlier tried to acquire the same 2300 MHz spectrum in December 2015, but the deal did not materialise. Vodafone, instead went on to acquire YOU Broadband’s entire business unit including spectrum assets for a reported Rs 350-400 crore. Although Vodafone initially declined to comment on the report, an Idea analyst presentation last week denoted: “Vodafone has acquired YOU Broadband. The transactions is subject to completion.” Note that Vodafone and Idea had announced a merger deal this week, to take on Reliance Jio. More on this here.
Tikona’s unsuccessful attempt to launch 4G; Fundraise
Speculations of Tikona’s 4G spectrum sale to Vodafone comes after Tikona seemingly abandoned its 4G broadband plans. Tikona had announced in October 2015 that it would launch “4G broadband plans” in 30 cities by the first half of 2016 but currently runs a pilot project in Varanasi for home and enterprise users. Tikona also provides wired broadband services in 23 cities. It had raised $171 million from an independent US government investment agency in January.