News
Some see deal by end-June; RCom working on finalising migration of CDMA base in July.
The tie-up between Indian mobile operators Reliance Communications and Aircel is on track, according to local press reports, with some saying a deal could be hammered out this month.
Citing unnamed sources close to the deal, the Business Standard said talks are progressing, but the paper intimated that it could be late July before they are able to conclude a deal.
However, the Financial Express quoted a source of its own as saying the telcos expect to close the transaction by the end of this month.
RCom entered into takeover talks with Aircel’s parents late last year, initially agreeing a 90-day exclusivity period. The companies have extended that period a couple of times, most recently late last month; they now have until 22 June to broker a deal.
Both newspapers agree that RCom’s plan to sell off a portfolio of telecoms towers will not affect the merger.
An unnamed senior company executive told the Financial Express that the Aircel deal would be completed before the towers sale, while the Business Standard simply said the Aircel deal is not contingent on the sale of the towers.
The Business Standard notes that the Aircel deal is particularly complex because the two companies operate on different mobile standards.
While Aircel is a GSM operator, RCom has its roots in CDMA. However, RCom is working on transferring its customer base to GSM or to 4G, a process it expects to have completed by the end of July, the paper said.
RCom and Aircel are widely believed to be working on an arrangement that will see them merge their respective mobile businesses under a new brand.
Given the intensity of competition in the Indian mobile market, the additional scale will be of paramount importance to both companies.
Together they claim a market share of 18.3% as of the end of March, according to the Telecom Regulatory Authority of India (TRAI), which would put them ahead of third-placed operator Idea Cellular, but behind leader Bharti Airtel with 24.3% and Vodafone with 19.2%.
