RCom, SSTL merger clears final hurdle - Mobile World Live

RCom, SSTL merger clears final hurdle

24 OCT 2017

India’s Department of Telecommunications (DoT) approved a INR50 billion ($766 million) merger of Reliance Communications (RCom) and Sistema Shyam TeleServices Limited (SSTL), clearing the way for the long-planned deal to move ahead.

DoT was the final authority required to endorse the merger, The Economic Times (ET) reported.

The deal boosts RCom’s spectrum portfolio and extends the validity period of its holdings in eight important regions until 2033. Based on last auction pricing, the spectrum is valued at INR190 billion. SSTL holds 3.75MHz of spectrum in the valuable 850MHz band.

After the merger, RCom is required to pay the government INR4 billion a year for ten years for the spectrum SSTL acquired in 2013, ET said.

SSTL, which operates under the MTS brand, had 3.8 million mobile connections and RCom about 80 million connections, according to Q3 data from GSMA Intelligence.

RCom, the country’s sixth largest mobile operator with less than a 7 per cent market share, announced earlier in the month it was dropping a planned merger with Aircel citing “inordinate delays caused by legal and regulatory uncertainties” as reasons.

RCom and Aircel had been in talks since December 2015 to combine their respective wireless operations.

In addition to dropping the Aircel deal, RCom faces an Ericsson lawsuit covering a debt of INR11.56 billion the vendor says RCom owes.

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Joseph Waring

Joseph Waring joins Mobile World Live as the Asia editor for its new Asia channel. Before joining the GSMA, Joseph was group editor for Telecom Asia for more than ten years. In addition to writing features, news and blogs, he...

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