Bharti Airtel’s acquisition of Tikona’s 4G business For Rs. 1,600 crore to take on Reliance Jio.

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image courtesy:iamWire

In a bid to further strengthen its 4G network amid surging data demand, Bharti Airtel, currently India’s largest telecom operator, will acquire internet service provider Tikona Digital Network’s 4G business, including the BWA (broadband wireless access) spectrum in the 2,300 mega hertz band in five circles for Rs 1,600 crore.

With this acquisition, Airtel will be second company, after Reliance Jio, in the country to have pan-India presence in 2300 Mhz band,which has second largest ecosystem of 4G devices. The acquisition is expected to help Airtel to take on Jio more effectively.

While the acquisition of the 4G business in Gujarat, UP (East), UP (West) and Himachal Pradesh will be done by Bharti Airtel, the acquisition in Rajasthan will be through its subsidiary Bharti Hexacom.

With the deal, which values Tikona at Rs 1,600 crore, Sunil Mittal-led Airtel is gearing up to face Mukesh Ambani’s Reliance Jio with a stronger data offering and faster customer addition.

Airtel plans to roll out high speed 4G services on the newly acquired spectrum in these five circles immediately after the closure of the transaction.

Post-acquisition, the combined spectrum holding of Airtel in these five circles will be within the spectrum caps prescribed by the government.

This acquisition by Airtel comes just three days after Vodafone and Idea, India’s second and third largest telecom companies announced a plan to merge their operations, which would make the merged entity the largest telco in the country, ahead of Airtel.

Last month, Bharti Airtel had also announced the acquisition of Norwegian telecom company Telenor’s Indian assets, to strengthen its network in the 1,800 MHz band.

“The deal will significantly bolster Airtel’s spectrum position in Gujarat and Himachal Pradesh, taking its overall BWA spectrum holding to 30 MHz each in these circles. Post completion of the deal, Airtel will have 30 MHz in the 2300 MHz band in 13 circles giving it tremendous advantage to handle the surging data demand,” the statement said.

Trilegal was the lead legal counsel for Goldman Sachs in sale of its shareholding in Tikona to Bharti Airtel.