Mumbai, Nov. 5: Bharti Airtel today junked its plan to acquire the Mumbai operations of Loop Mobile because the deal did not get regulatory approval.

The development will compound the problems for the nearly two million subscribers of Loop, who will have to look for other service providers. Had the deal gone through, they would have become the subscribers of Bharti Airtel.

The department of telecom (DoT) did not approve the deal as it estimated that Loop Mobile and its sister concern Loop Telecom owed about Rs 808 crore in spectrum and other charges to the government.

Loop Mobile’s permit in Mumbai will expire on November 29. The company did not purchase spectrum in the February auction, which was mandatory to continue its operations.

In a communication to the stock exchanges, Bharti Airtel said under the agreements executed with Loop Mobile, the transaction was conditional upon the DoT approval.

Bharti added that this clearance was not received even today and it was engaged in discussions with Loop.

“Loop had late last evening sent us an e-mail noting that the DoT approvals had not yet been received and had also noted that it was way beyond the time envisaged for securing such approval. In light of this update and the fact that Loop’s mobile licence is to expire at the end of this month, we have decided to terminate the discussions with regard to the transaction for acquiring subscribers of Loop,” Bharti explained.

Airtel had signed a deal with the Khaitan family-promoted Loop in February to buy the business and assets of Loop Mobile in Mumbai. Though the consideration was not mentioned, it was put at Rs 700 crore.

Under the agreement, Loop Mobile’s subscribers, which stood at around three million, would have joined Airtel’s over 4 million subscribers, making it the largest network in Mumbai.

The Bharti scrip today settled at Rs 385.30, down 2.70 per cent, on the BSE.