| Mittal: In control
New Delhi, June 7: The Mittals of the Bharti group have finally taken full control of Bharti Mobile, its cellular service provider in Andhra Pradesh, Karnataka and Punjab, by buying out Swedish partner Telia AB's 26 per cent stake in the venture.
The Mittals’ flagship company, Bharti Tele-Ventures Ltd, a listed company, informed the Bombay Stock Exchange today that Bharti Cellular Ltd, a wholly-owned subsidiary of the company, had increased its equity stake in Bharti Mobile Ltd from 74 per cent to 100 per cent by virtue of the acquisition of the Telia stake.
Sources in the company said the stake had been acquired for approximately $ 60 million though there was no official confirmation of the figure.
With this acquisition, Bharti Tele-Ventures has complete ownership in all its operating companies — mobile, fixed line, long distance and broadband. The only exception is a small 4.7 per cent in its Chennai mobile operations.
Sunil Bharti Mittal, chairman and group managing director of Bharti, said, “We are extremely pleased to consolidate our stake in these mobile operations. The circles of Karnataka, Andhra Pradesh and Punjab are amongst the select promising and prosperous states in the country, and are known to have a very high telecom potential. This also paves the way for completing the consolidation process of all our mobile operations under Bharti Cellular Limited.”
Bharti Mobile Ltd holds the licence to provide cellular services in Andhra Pradesh, Karnataka and Punjab. By virtue of this acquisition, Bharti Mobile Ltd becomes a wholly-owned subsidiary of Bharti Cellular Ltd.
Bharti Mobile has 12 lakh customers in the three circles. All these circles operate on GSM 900 Mhz networks. The current annualised revenue is over Rs. 850 crore. These states have high per capita income with population of about 16 crore. This represents a very high growth potential, as the mobile penetration is less than 1.80 per cent in these states.
Last year, BTVL had signed a memorandum of understanding with Telia to buy its 26 per cent stake in Bharti Mobile Ltd,
Bharti’s plan to buy out telecom transnational Telia AB’s 26 per cent stake in Bharti Mobile had hit a roadblock because of the lack of initiative by the Swedish government-owned company.
According to a senior executive of Bharti Tele-Ventures, Bharti have been discussing the issue over the past few months. “However, the response from Telia was slow and we could not go ahead with the deal. One of the reason for the slow progress was that since Telia is a government-owned company, the decisions were slow,” he said.