Synopsis
Bharti Airtel and Tata Group are in discussions for a merger of Tata Play's DTH operations with Bharti Telemedia, aiming to create a significant combined entity. This move comes while Airtel also collaborates with Ericsson to enhance its 5G capabilities for future growth.Key Takeaways
- Bharti Airtel is in talks with Tata Group for a DTH business merger.
- The potential merged entity may be led by Airtel.
- Tata Play and Airtel together have 35 million subscribers.
- Airtel has partnered with Ericsson for 5G Standalone technology.
- The merger discussions are still at an early stage.
New Delhi, Feb 26 (NationPress) Telecom giant Bharti Airtel Ltd. announced on Wednesday that it is in talks with the Tata Group regarding a possible merger of Tata Play's Direct To Home (DTH) operations with its subsidiary Bharti Telemedia.
This announcement was made following a media report suggesting that the two groups are 'close to a significant DTH merger'.
Airtel clarified, stating, 'We wish to inform that Bharti Airtel Limited (‘Airtel’) and Tata Group are currently engaged in discussions to explore a potential transaction for the combination of Tata Group’s DTH business under Tata Play Limited with Bharti Telemedia Limited, a subsidiary of Airtel, in a manner acceptable to all parties involved.'
However, Airtel underscored that 'these discussions are still in the preliminary stage.'
According to sources cited in the media report, the resulting merged company is anticipated to be managed by Bharti Airtel, which is likely to retain a stake of 52-55%, leaving the remainder to be held by Tata Play shareholders, including Walt Disney.
Tata Play is a 70:30 partnership between Tata Sons and Disney, and together with Airtel, they boasted a total of 35 million paying subscribers as of last September, accounting for over half of the industry-wide total of 60 million at that time, according to official statistics.
The valuation of the two businesses is estimated to be between Rs 6,000 crore to Rs 7,000 crore each, as reported by the media.
In a related update, Airtel has announced a collaboration with Ericsson to implement 5G Standalone (SA) network technology. This partnership aims to improve Airtel’s network capabilities, paving the way for a smooth transition to a fully operational commercial 5G SA network over time.
As part of this agreement, Ericsson will provide essential 5G equipment to Bharti Airtel, facilitating a seamless shift to a commercially active, full-scale 5G Standalone (SA) network.
'The long-standing partnership between Ericsson and Airtel has entered an exciting new phase, highlighted by the deployment of Ericsson's 5G core solutions to aid Airtel's transition to 5G Standalone. This rollout is crucial for Airtel's long-term 5G strategy, enhancing network capacity and enabling the provision of innovative, differentiated services to customers,' stated Airtel's Chief Technology Officer Randeep Sekhon.
The newly introduced capabilities signify a strategic boost to Bharti Airtel's efforts in monetizing 5G, fostering the development of new business models, as per Ericsson's statement.
In the SA configuration, the network is exclusively 5G, while in the NSA setup, the 5G operates as an enhancement on an existing 4G and 3G radio infrastructure.
Under the terms of the agreement, Ericsson will implement its signaling controller solution within Airtel's network. Additionally, Ericsson's 5G SA-enabled charging and policy solutions will be introduced, marking a strategic upgrade to Bharti Airtel's 5G monetization initiatives and allowing for the establishment of new business paradigms.
