Telecom sector is headed for a consolidation. After the Vodafone-Idea deal, Bharti Airtel has now entered into a definitive agreement with Tikona Digital Networks to acquire Tikona's 4G Business including the Broadband Wireless Access (BWA) spectrum and 350 sites, in five telecom circles.
Tikona currently has 20 MHz spectrum in the 2300 MHz band in Gujarat, UP (East), UP (West), Rajasthan and Himachal Pradesh circles. Airtel plans to roll-out 4G services on the newly acquired spectrum in the five circles immediately after the closure of the transaction, said a statement from company.
As per the agreement, the acquisition of the 4G business in Gujarat, UP (East), UP (West) and Himachal Pradesh will be undertaken by Airtel, while in the Rajasthan circle, it will be accomplished through Airtel's subsidiary Bharti Hexacom Limited. Post-acquisition, the combined spectrum holding of Airtel in these five circles will be within the spectrum caps prescribed by the government
The acquisition will enable Airtel to fill BWA spectrum gaps in the 2300 MHz band in Rajasthan, UP (East) and UP (West), thereby securing a pan India footprint in the band. The deal will significantly bolster Airtel's spectrum position in Gujarat and Himachal Pradesh, taking its overall BWA spectrum holding to 30 MHz each in these circles. Post completion of the deal, Airtel will have 30 MHz in the 2300 MHz band in 13 circles giving it tremendous advantage to handle the surging data demand.
“Airtel's acquisition of Tikona's 4G spectrum fills the gap that it had in the TDD-LTE band mainly in UP East, UP West and Rajasthan circles. With this acquisition Airtel will have nationwide TDD-LTE spectrum,” said Rishi Tejpal, Principal Research Analyst, Gartner.
“The Indian telecom sector is under pressure and the future expansion and growth will depend on the quantum of spectrum held and the quality of services offered,” he added.
The acquisition is subject to requisite regulatory approvals