Telenor India is reportedly exploring a merger with wireless broadband provider Tikona Digital Networks to stay afloat in an increasingly competitive market.
Both companies are in active discussions regarding a potential merger, India’s Economic Timesreported, citing multiple unnamed sources.
The focus on the negotiations is a merger of the two operators’ data businesses, and Telenor’s voice operations could be kept separate, according to the report.
Tikona holds 2300-MHz 4G spectrum and has operations in five of India’s 22 telecom circles, including three in which Telenor is also present. Telenor provides mobile services in six circles.
A potential merger would also serve as another way for Telenor to secure the spectrum it needs to expand its operations, including effectively rolling out 4G to compete with disruptive newcomer Reliance Jio and the incumbent operators. The operator’s current spectrum holding is limited to 1800-MHz.
In July, Telenor announced it has decided to sit out of the upcoming major Indian spectrum auction due to high reserve prices, and said the company has been “evaluating our options in India,” leading to speculation that Telenor may exit the Indian market.
Both Telenor and Tikona have declined to publicly comment on “speculation.”