Govt approves merger of Tata Teleservices' mobile business with Airtel

Telecom operator Tata Teleservices on Thursday said the Department of Telecom (DoT) has approved the merger of its consumer mobile business with Bharti Airtel.

Tata Teleservices listed arm said in a regulatory filing said the DoT through its letter dated February 6, 2020 has conveyed approval of the competent authority in DoT for taking on record demerger of consumer mobile business undertaking of the company into Bharti Airtel Limited (BAL).

"The DoT approval is without prejudice to the rights and contentions of the DoT till the telecom petition No. 22 of 2019 filed by BAL which is pending before Hon'ble TDSAT (and appeal, if any, against the Judgement(s) of the Hon'ble TDSAT) is disposed of," Tata Teleservices (Maharashtra) said.

 

Bharti Airtel on July 1 announced that the consumer mobile business of Tata Teleservices Ltd (TTSL) has now become its part.

The department, however, did not take the merger on record and asked Airtel to submit a bank guarantee of around Rs 7,000 crore and an immediate payment of Rs 1,287.97 crore before it takes merger of Airtel and Tata's consumer mobile business (CMB) on record.

The TDSAT on May 2, 2019 granted partial stay on around Rs 8,287 crore demand raised by the telecom department from Bharti Airtel for approving its merger with the consumer business of TTSL.

The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) had ordered the Department of Telecommunications to take on record the merger and approval of the schemes of arrangement by Delhi and Mumbai bench of the National Company Law Tribunal (NCLT). The DoT challenged the telecom tribunal before the Supreme Court and the matter is still sub-judice.

Bharti Airtel submitted only Rs 644 crore as directed by the TDSAT to complete the merger.

As part of the merger, Airtel has absorbed Tata Teleservices' CMB operations in 19 telecom circles - 17 under TTSL and 2 under Tata Teleservices (Maharashtra) Ltd. It also agreed to take over a small portion of the unpaid spectrum liability of Tata Teleservices.

The merger bolsters Airtel's radiowaves pool with additional 178.5 MHz spectrum in 1800, 2100 and 850 MHz bands, widely used for 4G.