Bharti Airtel is the most likely acquirer of the struggling Tata Teleservices as the Indian telecom sector consolidates into a four-operator market in the next three years, according to a just-published report by London-based CCS Insight, a global mobile and wireless market information and intelligence provider.
The report titled ‘Halcyon Days Ahead in a Four-Operator Market’ — published after a survey with 57 telecom M&A influencers — also details an “intriguing” alternative in Tata Tele merging with state-run BSNL, providing the latter a route to privatization.
The survey said 68 percent of the experts (bankers, lawyers and telecom executives with deal-making experience) thought a four-operator market would prevail by 2020. This scenario will have three private providers each with more than 300 million subscribers and one state-owned operator with over 100 million. CCS envisages Tata Tele finding home and the Ambani brothers finally agreeing to combine their two businesses, Reliance Jio and Relaince Communications.
The report coincides with speculation in recent months about Bharti Airtel accelerating bolt-on acquisition talks after a merger-in-progress between Vodafone and Idea Cellular dislodged it from the top slot in the Indian market. But a section of the analysts argued there is “little business sense” for Airtel to buy the loss-making Tata Tele.
By Baishakhi Dutta
