Airtel to acquire Loop Mobile in a Rs.700 crore deal
Airtel may announce the acquisition of the Mumbai based Loop Mobile in the next two days.
Bharti Airtel, which just bought the 900 MHz band spectrum in Mumbai in an auction, is likely to acquire Loop Mobile in the next couple of days.
The deal will make Bharti Airtel the largest telecom operator in Mumbai, with over 7 million subscribers. It surpasses Vodafone’s Indian unit, which has nearly 6.9 million customers.
According to sources involved in the deal, Bharti Airtel will get Loop’s 3 million subscribers, about 400 telecom towers and optic fiber. It includes the electronic equipment on which the Loop’s network currently runs.
According to sources, the deal is likely to be finalized for about Rs 700 crore. Currently, Loop Mobile has a debt of Rs 400 crore which is expected to be included in the final transaction. Bharti as well as Loop Mobile have declined to comment on the deal.
Loop Mobile has been in discussions with Airtel since last year. It is one of the oldest and most profitable telecom operators in the Mumbai area. The company which operates in the 900 MHz frequency did not renew its 10 year license. Instead Airtel bought the premium 900 MHz spectrum in Mumbai service area for about Rs 2,800 crore. The amount is about 70 per cent premium over the base price. The 900 MHz frequency band that Loop uses is preferred by cellular companies as it is more efficient and requires a lesser number of cell phone towers. Loop Mobiles generates the highest average revenue per user (ARPU) per month and has nearly 30% post-paid subscribers.
Source: PTI