TRAI calls for Indian mobile shake-out: report

Nicole McCormick
12 May 2010
00:00

India’s Telecommunications Regulatory Authority (TRAI) has recommended that the M&A rules be eased, potentially paving the way for much-needed consolidation in the market.

TRAI is advocating that mergers be allowed in any circle with at least six players.

But it says the merged entity can't account for more than 30% of total users in a given circle.

Under existing rules, a company can’t buy more than a 10% stake in another company that operates in the same circle.

For new licensees, such as Telenor’s Uninor, TRAI recommends that the original license owners must now only retain a 51% stake in the company for the first five years.

“We are clearly saying we should consolidate,” TRAI Chairman J S Sarma said.

The proposed new rules will be welcome news to India’s Big Three operators, Bharti Airtel, Reliance Communications and Vodafone.

The trio are battling it out for 3G spectrum in key areas, including Mumbai and Delhi, rather than gunning for pan-Indian footprints which at yesterday’s closing price would cost operators over the $3 billion mark.

Related content

Follow Telecom Asia Sport!
Comments
No Comments Yet! Be the first to share what you think!
This website uses cookies
This provides customers with a personalized experience and increases the efficiency of visiting the site, allowing us to provide the most efficient service. By using the website and accepting the terms of the policy, you consent to the use of cookies in accordance with the terms of this policy.