DoT refuses RCOM plea for additional spectrum (India)
DoT has rejected Anil Ambani-promoted Reliance Communication’s plea for additional 2G airwaves for its GSM based mobile services, and has also put on hold similar pending applications from other new entrants.
According to telecom ministry’s internal note it is not appropriate to process additional spectrum requests from any operator, including RCOM, since sector regulator TRAI was looking into the feasibility of pricing additional airwaves.
RCOM, which had been awarded 4.4 MHz of start-up GSM radio frequencies in most circles, had demanded for additional 1.8 units of spectrum on the grounds that this was the minimum amount committed to the company when it obtained approvals to launch services on this technology platform in 2008. Additional airwaves are given to companies after their subscriber base grows to touch certain pre-defined targets – these figures differ from state to state.
RCOM in its application for additional airwaves had also pointed out that TRAI’s latest recommendations say additional airwaves must first be made available to new entrants who have already been awarded start-up spectrum to help them perform their operations efficiently.
This implies that companies which hold 4.4 MHz of start-up spectrum will be given first priority to enhance this to 6.2 MHz for no additional cost. Next in line will be incumbents that currently hold less than 8 MHz of airwaves. Their holding will be enhanced to the 8 MHz cap provided they meet rollout obligations and pay the one time fee.
TRAI had added last in queue will be new entrants like Tata DoCoMo and Uninor, which are yet to receive start-up airwaves in many circles.
It is also learnt that the telecom ministry had decided to put on hold additional airwave allocations to all existing companies in a bid to avoid any legal complications.
This is because, Tata Teleservices told the telecom department that any move to award 2G spectrum according to a formula prescribed by the regulator would amount to serious discrimination against the company, while adding that the company had first rights to these scarce resources.
The telco, in which Japan’s DoCoMo has a 26% stake, also stated that any move to award additional airwaves first to operators that already had start-up spectrum of 4.4 MHz would favour a single company and would be discriminatory to others.
Tata Tele has been agitating with the government after the telecom department’s legal wing recently endorsed a proposal by TRAI which stated that additional airwaves should first be made available to new entrants who have already been awarded start-up spectrum to help them perform their operations efficiently.
While the implementation of this proposal will benefit RCOM in all circles, it will result in operators such as Tata DoCoMo and Uninor which are yet to receive start-up airwaves in many circles being placed last in the priority queue for airwaves, and these companies will not stand any chance to get startup 2G spectrum in circles like Delhi.
Etisalat considers buying Zain
The UAE’s Etisalat is mulling over to buy a controlling stake in Kuwaiti telco Zain.
According to sources, Etisalat is in direct talks with shareholders that own a combined 46% of the company over buying their entire stakes. This would give Etisalat a controlling majority, as about 10% of Zain’s shares are held as treasury stock.
The deal, if takes place, will be one of the largest ever M&A deals in the Gulf.
As per the reports, the shareholders are thought to include the Kharafi family -who hold nearly a quarter of the company- and other investors associated with them.
Etisalat has offered US$5.97 per share. The value of the entire 46% stake has been reported as US$10.5 billion and US$12 billion.
The company has confirmed that it has made a conditional offer while Zain’s board claims that it was not aware of a deal, which means that Etisalat took the deal directly to shareholders.
Etisalat has more than 100 million customers across 18 countries in the Middle East, Africa and Asia. Zain has operations in eight countries in the Middle East, and a customer base of around 34.2 million.
If rumors are to be believed, Etisalat is negotiating for a stake in Indian operator Reliance Communications, but a deal has so far yet to materialize.
‘Reliance-GTL’ Infrastructure asset deal worth US$9 billion on Halt
Reliance Infratel, the tower subsidiary of Reliance Communication, and GTL Infrastructure have decided to suspend their deal without stating any reason.
According to Reliance Infratel, Reliance Communication is now in discussions with certain other strategic and financial investors to pursue a similar transaction aimed at significant reduction in the company’s debt from the passive infrastructure and related assets in its 95% owned subsidiary. Owing to the provisions of mutual confidential agreements, RCom cannot provide any comment on the reasons for the inability to conclude a transaction with GTL Infrastructure.
The deal, which was said to be the major domestic acquisition of this year, was likely to help the consolidation in India’s telecoms industry. Reliance in talks to sell 26% of itself to Etisalat, a UAE-based telecommunications services provider.
According to an analyst with IIFL, Reliance has net debt of $7bn, giving it a ratio of net debt to earnings before interest, taxation, depreciation and amortization of 4.5 times. The deal with GTL, under which the tower company, which is controlled by multi-millionaire Manoj Tirodkar, would have bought nearly 50,000 towers from Reliance, would have reduced the mobile operator’s net debt to EBITDA two – three times. It would certainly have put RCom on a forward-facing trajectory.
According to Reliance, the non-binding term sheet with GTL had expired, enabling it to talk to other parties.
Reliance decides to sell 26% stake (India)
www.WirelessFederation.com/news: India’s second largest telecom operator by subscribers, Reliance communication has decided to dilute 26 percent stake in the company to strategic or private equity investors. Reliance is controlled by Indian billionaire Anil Ambani, who holds 67 percent of the telecoms operator.
Last week itself, the company announced that the company has received various expressions of interest already.
Saudi Arabia based Etisalat and South African MTN are reportedly the buyers willing to pay around USD 3.8 billion for a 25 percent stake in Reliance.
According to the people familiar with the matter, AT&T has also started informal talks with Reliance about taking a minority stake.
MTN denies talks of tie- up with Reliance Communication (India)
www.WirelessFederation.com/news: South African wireless communications firm MTN Group Ltd has declared its desire to continue expanding its footprint in emerging markets but denied its talks of tie up with Reliance Communications Ltd. This has also put a halt to the news that revisiting plans to push into the giant Indian market.
However, there are speculations that it might look again at a merger with Reliance, India’s second-largest mobile company by subscribers, since controlling owner Anil Ambani scrapped a pact with his brother that had quashed a deal with MTN in 2008.
According to Nozipho January-Bardill, MTN executive for corporate affairs, the company is not in discussions to merge with or buy a stake in Reliance Communications and nor is it interested in beginning such talks now. Earlier it was reported that Reliance has received proposals from international telecommunications companies interested in buying a strategic stake but the names of the firms were not taken.
In April, the MTN has also revealed that it was considering the acquisition of some or all of Egyptian operator Orascom Telecom Holding.
MTN- Reliance deal fuelled after Ambanis’ ceasefire
www.WirelessFederation.com/news: The resolving of the dispute between the Ambani brothers has been expected to be the reason behind the sudden 6% increase in the share price of MTN, South Africa’s leading telecoms company and the biggest mobile operator on the continent.
According to a deal between Mukesh Ambani and Anil Ambani, both of them will do away with non-compete†agreements they had signed when they divided their late father’s empire between them in 2005. India’s second-largest mobile operator, Reliance Communication owned by Anil Ambani has also been included in the agreement. Older brother Mukesh had enacted a right of first refusal when Anil had tried to sell a large stake in Reliance to MTN two years earlier calling it an incompetent deal.
In the current scenario, it is unlikely that Mukesh will come up with any objections and if the deal materializes, it would create one of the world’s largest emerging-markets mobile groups with about 230m subscribers. However, many believe MTN would be more than reluctant to consider returning to the negotiation table with an Indian company.
Three attempts had been made in the past by Phuthuma Nhleko, MTN’s chief executive to tie up with an Indian company; once with Reliance and two times with Bharti Airtel, the biggest company in the subcontinent. The failure of the talk with Bharti Airtel had been the topic of discussion after the Indian telco clinched a deal with Zain Africa. There is speculation that the MTN board will review its India strategy at the meeting due to objections from the Algerian government.
A deal with Reliance if it followed the previous structure put forward by Anil Ambani would give MTN a 51 per cent stake in Reliance Communications in return for a 25 per cent stake in the South African group. However, as of now, the prospect of a return to India might appear to be far-fetched.
Reliance rolls out cheapest CDMA phone in India
www.WirelessFederation.com/news: CDMA phone S100 will be rolled out by Reliance Webstore, the retail subsidiary of Reliance Communications and Coolpad Communications, the Indian joint-venture of Hong Kong-listed China Wireless Technologies Limited, across India.
The ‘touch-screen’ model will be retailed and distributed through Reliance World stores across 100 top Indian cities. According to Coolpad Communications’ Managing Director, Sami Al-Lawati, in the current scenario, the firm sees CDMA subscribers as the key drivers of mobile data business in India and feature-rich CDMA handsets will play a crucial role in addressing this segment.
Dual-mode handsets have already been introduced by Coolpad in India and the S100 is the company’s first CDMA-only handset being introduced in the country. 15 CDMA handset models is also planned to be launched by the company in India during the current fiscal.
Pan- India 3G license bid touches Rs 16,828 crore
www.WirelessFederation.com/news: The bid for the pan- India 3G license auction reached Rs 16,828 crore, double the amount which has been expected by the government. In the auction that lasted for 34 days, Bharti, Idea and Vodafone Essar are said to win in some of the circles. The reserved price of the auction was Rs 3,500 crore and the expected to earn 70,000 crore.
Auction for Broadband Wireless Access (BWA) spectrum will commence by the government two days after the close of auction for 3G telephony spectrum.
Nine leading mobile operators, including Bharti Airtel, Vodafone, Reliance Communication and the Tata Teleservices, had entered the auction to grab spectrum for 3G services. The 3G services will allow users to access high-speed data downloads on mobile phones.
Only three operators in most state would have managed to get a slot while four were available in Punjab, Bihar, Orissa, Jammu and Kashmir and Himachal Pradesh.
Indian telco RCom to launch PTV services in Mumbai & Delhi
www.WirelessFederation.com/news: IPTV services of India based mobile operator, Reliance Communication is set to be launched in Delhi and Mumbai within the next three months. Currently the PTV services have been offered by state owned Indian telcos, Bharat Sanchar Nigam Limited and Mahanagar Telphone Nigam limited.
According to RCOM’s CEO (DTH and IPTV) Sanjay Behl, the company has plan to start its proposed IPTV service initially in Delhi and Mumbai in the next three months and in the second phase it also has plans to introduce it in six other cities.
