Bharti Airtel, Tata to merge consumer mobile businesses

As a part of this transaction, Airtel will take over Tata's operations in 19 circles across the country, two of which are under TTML and the rest are under TTSL. Tata Group's telecom arms - both Tata Tele (TTSL) and Tata Teleservices Maharashrta (TTML) will now be merged with Bharti airtel. "The customers of Tata will be able to enjoy India's widest and fastest voice & data network, and bouquet of Airtel's best-in-class products and services", he said. Finding the right home for our longstanding customers and our employees has been the priority for us.

The agreement, signed in 2008, failed to attract enough customers and Docomo triggered an option to sell its stake six years later after incurring losses. The fixed line and broadband businesses could be brought under privately-held Tata Sky.

On Monday, Chandrasekaran had admitted to news outlet CNBC's local associate that the group's mobile business was in a "really bad shape", struggling under a huge debt pile.

A court case followed and in June 2016 an worldwide arbitration court ordered Tata to pay $1.17 billion in damages.

The sale of Tata Teleservices is part of Chandrasekaran's larger plan to shed the $103-billion group of stressed assets that are impacting overall profitability. Airtel is also not taking Tata Tele's debt.

Airtel will not take any debt with Tata Teleservices and neither will it pay any cash for the same.

Tata Group, which is known for doing business transparently, could not manage telecom regulatory policies of several decision makers in the recent governments.

Agrawal, who in July joined Tatas from Aditya Birla Group, said closing down the business would have been against the ethos of Tata Group and would have rendered employees jobless.

In August, Tata Steel formed a joint venture with Germany's ThyssenKrupp to manage operations in Europe, after a round of sell-offs of steel plants in the United Kingdom and in continental Europe. According to a CLSA report, the answer is yes. The team of Bharti Airtel is said to be discussing the deal internally and might announce it officially later today or tomorrow.

Tata could not compete with established players - Airtel, Idea Cellular and Vodafone and Reliance Jio - in the highly competitive telecom market.

Pressure has been mounting on telecom companies since Reliance Industries' telecom arm emerged on the scene in September a year ago.

The gap in the strategy of Ratan Tata and Mukesh Ambani is visible from the difference in telecom related investment by TTSL and Reliance Jio. Airtel has about 265 million customers in the country and the number will go up to 305 million after adding the 40 million customers of Tata Tele. On Tuesday, Bharti Airtel revealed 4G phones, in association with Karbonn Mobiles, for the effective price of 1,399 rupees.

We have been seeing a lot of changes and developments in India's telecom sector since last year, with the major one happening this year like the Vodafone-Idea merger.

Vanessa Coleman

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