Alca-Lu frontrunner for Bharti $1b outsource tender

Ruth David
03 Feb 2010

Alcatel-Lucent is the likely frontrunner for Bharti Airtel’s latest fiber cable network outsourcing contract, analysts have told

Bharti Airtel chief executive Manoj Kohli has said the company plans to outsource the management of over 12,000 kilometers of its inter-city optical fiber network.

While company executives have refused to comment on the deal, two industry sources tracking India’s largest wireless business estimated the contract at more than $1 billion over five years.

Kohli told The Economic Times Bharti would form a joint venture and have a stake in the company to which the contract was awarded. Bharti already has a 26:74 joint venture with Alcatel-Lucent. It entered into the partnership in April last year, to let Alcatel-Lucent manage its landline and broadband business in 100 cities. The five-year contract involves Bharti paying the joint venture $500 million.

Alcatel-Lucent “is the likely front-runner to win the contract,” says India Infoline analyst G.V. Giri, pointing to its expertise in the landline as well as wireless space and existing deal with Bharti. Executives from Alcatel-Lucent hadn’t responded to emails on the issue when the story was filed.

But if for some reason Alcatel-Lucent loses out, Bharti is likely to go with a blue-chip multinational, given its past choices for outsourcing contracts in India, Giri says. Nokia Siemens and Ericsson are also possible candidates, and both have existing contracts to manage Bharti networks.

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