New Indian mobile operators Etisalat DB and Allianz Infratech have reportedly announced plans to merge in what is seen as the beginning of a wave of consolidation in the country’s crowded mobile sector. According to a Times of India report, Etisalat DB – the network formerly known as Swan Telecom – is to merge its activities in 13 circles with Allianz Infratech’s two universal access service (UAS) licenses. The merged entity will have 15 circles out of India’s total 22. As the two yet-to-launch networks do not overlap in any circles, they are able to bypass current M&A restrictions, which means the merger could complete as early as the first quarter of next year. UAE’s Etisalat bought a 45 percent stake in Swan Telecom in September 2008, which valued the company at INR9,400 crore (US$2 billion). Allianz Infratech was granted UAS licenses in Madhya Pradesh and Bihar in August 2008.

According to Times of India, the Telecoms Regulatory Authority of India (TRAI) is currently looking to change the current M&A rules to encourage consolidation in the telecoms sector. It predicts that this could reduce the level of competition from the current 13-14 operators per circle to approximately 8-9 in the next 18 months and perhaps down to six over the next 2-3 years. The current guidelines do not allow for mergers of two entities in the same service area, or the spectrum of two entities in the same service area to be combined till three years from the effective date of license. In other regional news today, the Economic Times reports that the country’s long-awaited 3G auctions could be delayed yet again. It says the notice inviting bids for the sale process, originally scheduled to be issued today, may now be delayed until the end of the month, which could push back the auction start date to end-February or early March. The auctions are currently scheduled to start on 14 January.