News
Indian operator could reopen spectrum-trading talks with rivals, according to press report.
Tata Teleservices could sell off some of its spectrum in order to raise the money it needs to buy out NTT DoCoMo, according to local press reports in India.
The Indian mobile operator is considering re-opening spectrum-trading talks with rival players and has sent out feelers to that effect, the Hindu Business Line claimed, citing unnamed industry sources.
The outcome could see Tata sell off some of its spectrum holdings in the 800 MHz and 1800 MHz bands, the sources said.
The London Court of International Arbitration last week ordered Tata Sons to pay Japan’s NTT DoCoMo US$1.17 billion in damages for breach of the pair’s shareholder agreement with regard to Tata Teleservices, which operates under the Tata DoCoMo banner. NTT DoCoMo has been trying to offload its 26.5% stake in the mobile joint venture for the past couple of years and had turned to arbitration to recoup what it believes is a fair value for the shares, in accordance with the terms of the deal struck by the pair in 2009.
Tata Teleservices has engaged in spectrum-trading talks with a number of operators in the past, including Vodafone and Telenor, without success, the paper noted. Now the government has set rules regarding trading and there is some clarity around the situation with NTT DoCoMo, it may re-start negotiations, its sources explained.
However, there are a number of obstacles in front of Tata, should it choose such a route.
According to the Hindu Business Line, much of Tata’s 1800-MHz spectrum was allocated under older rules, which means it would have to pay the market price to the government for the airwaves before being permitted to trade them, thereby reducing its proceeds from any sale.
It could also look to trade its 800-MHz spectrum which is currently used for CDMA services but could be reappropriated for 4G. However, some of its licences are due to expire soon, the paper said.
