Bharti Airtel to buy Telenor India as sector consolidation continues
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Bharti Airtel, India’s largest mobile phone operator, has struck a deal to buy the Indian business of Norway-based Telenor. The move comes as an aggressive entry into telecoms by one of the country’s largest businesses, Reliance Industries, prompts a wave of consolidation in the sector.
Bharti Airtel will acquire Telenor India’s operations in seven regions including the populous states of UP, Gujarat and Maharashtra.
The company declined to comment on the price of the deal but said it will bring “significant synergies”.
Last month Vodafone India, the Indian unit of the UK-based group, confirmed that it was in merger talks with Idea Cellular in a deal that would create one of the world’s biggest telecoms groups and eclipse Bharti Airtel as the largest player in India.
The acquisition will bring an end to Telenor’s operations in India.
Gopal Vittal, managing director and chief executive in India and South Asia of Bharti Airtel said:
The acquisition of additional spectrum through this transaction, which made an attractive business proposition, has further enhanced our already solid spectrum portfolio. The proposed transaction will also create substantial long term value for our shareholders given the significant synergies.
Sigve Brekke, chief executive of Telenor Group said:
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.
Bharti Airtel shares were up 4.9 per cent in New Delhi.