There has been fresh speculation of impending consolidation in India’s mobile market after reports claimed that Reliance Communications has held merger talks with Sistema.
Sources cited by Bloomberg on Friday claimed Reliance Group chairman Anil Ambani met with Sistema president Vladimir Yevtushenkov to discuss an all-stock deal that would see RCom take over the latter. A similar report also appeared in the Times of India on Saturday.
Both sides have played down the speculation. Yevtushenkov admitted to Reuters that while Sistema is talking to several parties about business expansion, he insisted he has no imminent plans to sell.
India is home to no fewer than 12 mobile operators and Reliance Communications is the fourth-largest with 109.5 million customers at the end of March, according to the Telecoms Regulatory Authority of India (TRAI). Market leader Bharti Airtel boasts 226 million customers. Sistema is tiny by comparison, occupying ninth spot with 8.9 million customers.
With fierce competition putting the squeeze on margins, there is pressure to consolidate.
Earlier in May, local media claimed that Telenor’s Indian unit, Uninor, is in talks to acquire smaller rival Videocon Telecom, a move that would push the former’s market share above 5% from 4.7% at the end of March.
Sources cited by the Economic Times said Videocon values itself at around 100 billion rupees (€1.37 billion).
