Data services and IT solutions provider Tulip Telecom today said it will offload its entire 13% stake in the joint venture (JV) with Qualcomm, as soon as the American major decides to exit the Indian broadband wireless market.
The joint venture, floated to implement long-term evolution (LTE) technology in the emerging Internet broadband segment, has three partners -- Qualcomm, Tulip Telecom and Global Holding. While Qualcomm holds 74% stake, the two others have 13% shareholding each.
"Our investment is purely in business terms, we are not a prominent player in retail segment we operate mostly on enterprise communication services. As and when Qualcomm will decide to exit the Indian broadband wireless market by selling its remaining 74% stake to an Indian telecom operator, we will also exit from the joint venture," Tulip Telecom Chairman & Managing Director HS Bedi said.
Qualcomm plans to exit the venture after creating a long-term evolution, or LTE, network to roll out broadband wireless access services.
Qualcomm, which is a leader in LTE technology, has BWA licences for offering mobile broadband services in four circles -- Delhi, Mumbai, Haryana and Kerala -- in India.
LTE (Long Term Evolution) is considered as '4G' technology because it is faster than 3G, and uses an architecture where everything (including voice) is handled as data, similar to the Internet.
Earlier, media reports had said that Qualcomm has entered into a $1.2 billion deal to sell its BWA spectrum in four circles to a private telecom operator.
Qualcomm had announced that it will work with 3G operators to develop the 3G+LTE ecosystem, commercially deploy LTE TDD in the BWA spectrum and then exit India LTE venture.
Following the auction, Qualcomm had formed separate joint venture companies for the four service areas. The company sold a 26% in the broadband unit to Tulip Telecom and Global Holdings for $57.72 million (about Rs 268 crore) last year.
Foreign companies cannot hold more than a 74% stake in an Indian telecom entity.
Tulip Telecom is a data telecom service, IT solutions provider and offers innovative IP based infrastructural solutions to its customers.
The company had revenues to the tune of Rs 1,966.40 crore ($423 million) in the financial year ending March 31, 2010 and a market capitalisation of over Rs 2,500 crore ($500 million as on March 2010).
