Tata Tele could buy out Virgin Mobile India

Melissa Chua
14 Apr 2011
00:00

India’s Tata Teleservices is reportedly planning to buy UK-based Virgin Group’s 50% stake in Virgin Mobile India.

Virgin Mobile India is an MVNO that has been operating using Tata Teleservices’ network for the past three years. The planned buyout is not expected to affect the current branding arrangement in the near future, according to sources the Hindu Business Linespoke to. Tata Teleservices is expected to continue paying royalties for the use of Virgin branding for at least three years.

The Virgin Group and the Tata Group had signed two deals in 2008 – a 50:50 JV for mobile connections on a revenue share basis and a branding arrangement that allowed Tata Teleservices to use the Virgin brand for a royalty payment.

Virgin Mobile India is targeted at the youth market, with presence in all circles where Tata operates mobile services – 22 circles for CDMA and 18 circles for GSM.

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