America Movil could be considering an Indian mob ile acquisition, if rumours in the Indian press this week prove to be accurate.
Company owner Carlos Slim visited India a couple of weeks ago and visited a number of telecoms companies, the Economic Times reported, citing unnamed sources. These included Videocon, which earlier this year indicated that it would be willing to sell control of its mobile operations and has since been linked with a number of possible partners.
One of the paper’s sources said Slim was upbeat on the growth opportunities in the Indian telecoms space.
America Movil’s growth opportunities in its home market are restricted to an extent – at least when it comes to market share – by new regulations designed to curb its market power. In addition, it is facing new competitive pressure from AT&T, which recently bought Iusacell and Nextel to establish itself in the Mexican mobile market.
America Movil has moved into Europe in the past few years, taking stakes in Telekom Austria and KPN, and is building up its presence in the U.S. through its Tracfone business.
With all of the above in mind, a venture into India seems a fairly credible step for the company to consider.
The Economic Times said America Movil declined to comment on Slim’s visit to India, while a Videocon executive told the paper that the company is in talks with a number of large international telcos looking to make strategic investments.
There has been talk of a tie-up between Videocon and Telenor-owned Uninor, which is thought to be keen to boost its market share.
According to the Telecom Regulatory Authority of India (TRAI), Videocon had 7.1 million customers at the end of the first quarter of this calendar year, giving it a market share of just 0.74%. At the same date Uninor had 7.7%.
Growth remains in the market, with mobile penetration in rural areas standing at 48%, but any ne w entrant would need to take into account the low ARPUs these would-be customers would generate.
