India's DoT approves Airtel-Telenor India merger

15 May 2018

India's Department of Telecom (DoT) has approved the planned merger between Telenor India and Bharti Airtel, which will create an operator with a subscriber base of around 334 million.

The department has signed off on the merger after being directed to by the Supreme Court, the Economic Timesreported.

The DoT had petitioned the court seeking to compel the operators to submit a security deposit of around 17 billion rupees ($251.6 million) before approving the merger. This deposit would cover unpaid spectrum fees from Telenor and a one-time spectrum charge on Airtel for the spectrum that the operator will acquire through the merger without an auction.

But the court has dismissed the petition and instructed the department to approve the merger.

With the acquisition, Airtel will acquire an additional 43.4 MHz of spectrum in the 1800-MHz band, spread across seven of India's 22 telecoms circles.

The company will also absorb Telenor's subscriber base in these circles, which will leave the incumbent operator with nearly twice as many subscribers as new entrant Reliance Jio Infocomm.

As a condition of approval, Airtel has been instructed to reduce its market share based on adjusted growth revenue in the Bihar telecoms circle to the limit of 50% within one year of completing the merger.

Norway-based Telenor is meanwhile fulfilling its goal of exiting the Indian market due to the intense competition and the high cost of spectrum.

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