Bharti Airtel is reportedly close to buying smaller rival Loop Mobile, with some sources suggesting a deal could be announced as soon as tomorrow.
According to Economic Times, Airtel will gain Loop’s three million subscribers, which will give it number one position in the Mumbai market (displacing Vodafone India).
Airtel will also acquire infrastructure assets such as towers, fibre optic links, and electrical equipment.
The paper said the deal follows Airtel acquiring Loop’s spectrum in Mumbai in a spectrum auction which was completed last week.
Mumbai and Delhi are seen as the most lucrative markets in India, and Airtel is already the market leader in the second of these.
Loop also has a high number of lucrative contract subscribers, generating high average revenues per user.
Reuters said that Airtel will pay INR3 billion ($48 million) for Loop, as well as taking on INR4 billion of Loop’s debt.
With the Indian market having seen tough price competition in recent years, it was also noted that consolidation has not taken place due to what were described as “challenging” merger rules.
This includes the need for buyers to pay separately for the acquired company’s frequencies.
Airtel has been mooted as a potential buyer of Loop for some time, but the spectrum auction appears to have spurred it into a final action.
It has also been reported that Vodafone Group is eyeing Tata Teleservices, in a move that would create India’s largest mobile operator.