Airtel-Loop Mobile deal to push Vodafone to 2nd spot in Mumbai

Airtel-Loop Mobile deal to push Vodafone to 2nd spot in Mumbai

Loop Mobile's potential merger with telecom operator Bharti Airtel will push Vodafone to the second spot in the Mumbai circle.

After the completion of the deal, Airtel will surpass its biggest rival Vodafone to grab the top spot in Mumbai, with a combined subscriber base of 7.3 million. Vodafone will slip to the second spot with nearly 7 million subscribers in the circle.

However, many analysts say that the race for having bigger subscriber base doesn't make sense in the modern days as spectrum is now not given on subscriber-linked criteria.

Bharti Airtel Ltd, which is the biggest mobile phone operator of India, confirmed on Tuesday that it had signed a strategic deal with Loop Mobile to acquire it. Loop Mobile operates only in Mumbai. Under the terms of the agreement, Airtel won't take over the management and employees of Loop. It will take over only its subscribers and assets like towers and passive infrastructure. More precisely, it will acquire Loop's 400 towers and optic fibre and electronic equipment.

While neither Airtel not Loop Mobile revealed the deal's financial details, reports suggest that Airtel will fork out Rs. 700 crore to acquire Loop. According to the reports, Airtel will pay Rs 300 crore to Loop promoters, and take on Rs 400 crore of the company's debt.

However, the acquisition deal is subject to regulatory approvals.

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